BEIJING, Sept. 19, 2012 /PRNewswire-FirstCall/ -- General Steel Holdings, Inc. ("General Steel" or the "Company") (NYSE: GSI), one of China's leading non-state-owned producers of steel products and aggregators of domestic steel, today announced its plan to initiate construction on a state-of-the-art, 900,000 metric ton seismic-grade rebar production line at its principal manufacturing facility, Longmen Joint Venture ("Longmen JV"), located in Hancheng City, Shaanxi Province, China. The production line incorporates cutting-edge technology that is expected to reduce rebar production costs by approximately RMB100 per metric ton.
"Through the implementation of new production lines that utilize cutting-edge technology, we are reducing energy consumption and production costs, while improving the quality of rebar we produce. This is consistent with our broader efficiency improvement programs and efforts to optimize our capacity utilization capabilities at Longmen JV," said General Steel's Chairman and Chief Executive Officer Henry Yu. "The launch of this new production line better positions our Company at the high-end of the steel value chain where we can be a standard-bearer for high-quality construction steel products. At the same time, this is an investment in our growth that enables us to meet increasing customer demand, generate sustainable profitability and improve shareholder value."
In 2011, General Steel completed the installation and testing of a one million ton high-speed wire production line and a 1.2 million ton rebar production line, both of which were transferred to the Longmen facility from the Company's Maoming facility to leverage economies of scale. As part of the Company's growth strategy, Longmen JV plans to continue increasing its annual rebar rolling capacity through the installation of additional rebar production lines at its facility. By rolling rebar at the same facility in which steel billet is produced, the Company can eliminate the process of cooling, transporting and re-heating of the steel billet for processing at another location, substantially reducing the costs.