Baowu

China Baowu Steel Group Corp., Ltd., commonly known as Baowu, is a state-owned iron and steel company headquartered in the Baosteel Tower in Pudong, Shanghai, China.[3] The company was formed by Baosteel Group absorbing its smaller state-owned peer, Wuhan Iron and Steel Corporation in 2016. It is the world's largest steel producer.[4]

In 2015, Baowu was the second largest steel producer in the world measured by crude steel output, with an annual output of around 35 million tons (China's total steel production in 2015 was 803.8 million tons[5]), and employed 130,401 employees as of the end of 2012, had annual revenues of around $21.5 billion, and produces a mix of products.[6] In 2019, the company closed the gap with ArcelorMittal reaching 95.47 million tons of steel, and hitting $78 billion in revenues,[7]

History

Baoshan Iron and Steel

In 1978, as part of the Chinese government's reform and opening, Chinese paramount leader Deng Xiaoping sought to develop large-scale steel production in China.[15] The government planned for a large integrated steel production facility to be located near the port of Shanghai, in Baoshan District, a suburb of Shanghai.[15] In 1978, a delegation from the Chinese government, including Deng Xiaoping himself, visited a steel mill operated by Nippon Steel to learn how to construct such a large facility.[15] As the government's flagship steel company, Baoshan Iron and Steel (Baogang) as it was originally called, benefitted from acquiring the engineers and managers, access to technology, and receiving government contracts.[16]

Initially, the firm limited its exports to just 10% of steel production, hoping to fulfill domestic demand.[15] Baoshan Iron and Steel served the light industry base around Shanghai.

In the 1980s, Baoshan Iron and Steel supplanted Angang as China's largest steel producer.[17] Baoshan Iron and Steel also benefitted from the Chinese economic expansion which consumed all the steel available. However, with the continuing liberalization of the Chinese economy, Baoshan found itself in competition with new rivals, both foreign and domestic. By the late 1990s, the company removed its cap on steel exports;[15] it scored notable success in South Korea. Although hurt by the Asian financial crisis, Baoshan pushed through with a merger of other money losing state owned enterprises, though it had managed to remain profitable itself.

Baosteel Group

Through the policy of grasping the large, letting go of the small, the company was among the large state-owned enterprises to be strengthened through mergers and government support, with the goal of turning it into a national champion.[18] On November 17, 1998, the former Baoshan Iron and Steel (Group) Corporation absorbed the Shanghai Metallurgical Holding Group Corporation (上海冶金控股集团公司) and the Shanghai Meishan Group (上海梅山集团公司) to form Shanghai Baosteel Group Corporation. The new conglomerate was the largest steel producer in the country with annual steel production of nearly 20 million tons. Since then, the strategy of Baosteel Group has been to expand production capacity in iron and steel, achieve vertical integration along the value chain, and acquire related industries.[19]

In 1997, a subsidiary of Shanghai Metallurgical Holding, the former Shanghai No.3 Iron and Steel Plant, Shanghai Pudong Iron and Steel, formed a joint venture with ThyssenKrupp of Germany, as Shanghai Krupp Stainless.[20] It followed the parent company to become a subsidiary of Baosteel Group in 1998.[21]

On 21–22 September 2016, a plan to merge Baosteel Group and fellow state-owned steel maker Wuhan Iron and Steel Corporation was announced. Baoshan Iron and Steel Company Limited, the listed portion of Baosteel Group would takeover the counterpart Wuhan Iron and Steel Company Limited in an all-share deal,[28] while the rights of Wuhan Iron and Steel Corporation would be transferred to Baosteel Group for free as a wholly owned subsidiary. Both Baosteel Group and Wuhan Iron and Steel Corporation were supervised by SASAC of the Central Government. As of December 2016, the name of the new group is China Baowu Steel Group Corporation.[29] It is now the second largest steel producer in the world, with assets estimated to be worth around 730 billion Yuan,[30] employing 228,000 employees and expected annual sales revenues of 330 billion Yuan ($47.9 billion).[31]

type	State-owned enterprise
industry	Steel
foundation	1978
predecessor	Shanghai Baosteel Group Corporation Wuhan Iron and Steel Corporation
key people	Hu Wangming (Chairman)
products	Steel, flat steel products, long steel products, wire products, plates
revenue	US$157.216 billion (2023)‡R1R‡
net income	US$2.494 billion (2023)‡R1R‡
assets	US$191.964 billion (2023)‡R1R‡
num employees	382,894 (2023)‡R1R‡
owner	Chinese Central Government (100%)
parent	State-owned Assets Supervision and Administration Commission of the State Council
subsid	see list
homepage	www.baowugroup.com
footnotes	‡R2R‡
location	Shanghai, China

Baowu

History

Baoshan Iron and Steel

Baosteel Group

Baowu

Subsidiaries

Equity investments

External links

References