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History of Wuhan Iron and Steel

History of Wuhan Iron & Steel History of Wuhan Steel

Wuhan Iron & Steel was the 11th largest steelmaker in the world, producing ~26 million tonnes (mt) of steel in 2015. The company was acquired by Baosteel at end-2016, to create the Baowu Iron and Steel Group.

Wuhan Steel Timeline

  • Foundation Era (1955-1963): Construction of Wuhan iron and steel facilities commences in 1955, WISCO founded in 1958, open hearth furnace No.1 put into production at Qingshan, Qingshan heavy steel rolling mill project completed
  • Early Growth (1964-1989): WISCO production reaches 1 million tons by 1970, introduction of modern foreign technology from Germany and Japan setting precedent for Chinese steel industry modernisation
  • Domestic Consolidation (1990-2004): Period of internal development and preparation for major acquisition strategy, building foundation for future expansion and modernisation efforts
  • Acquisition Phase (2005-2008): Acquires 51% equity of Liuzhou Iron & Steel for 6.5 billion yuan, Chinese wire rope JV agreed with Wire Corp of America, plan for Kunmin Steel integration agreed, sets up US West Coast trading office
  • Strategic Expansion (2009-2014): Acquires Echeng Iron and Steel, commissioning of new convertor at Nanning by Liuzhou Steel, POSCO export cooperation agreement, completes remaining Liuzhou purchase, drops Brazil steel mill plans, buys ThyssenKrupp tailored blanks division, develops Liberia iron ore project
  • Challenges & Merger (2015-2017): Anti-corruption investigation of former chairman Deng Qilin, concerns about foreign investments, start-up of 8.6mt/yr Fangchengang steelworks, merger with Baosteel creating China Baowu, Deng Qilin imprisoned for 15 years
Timeline shows 61-year evolution from 1955 construction start to world's 11th largest steelmaker by 2015 producing ~26mt, culminating in historic 2016 merger with Baosteel to create China Baowu Iron and Steel Group.

The timeline below covers the history of the firm until the point of the takeover by Baosteel.

  • 1955: Construction of Wuhan iron and steel facilities commences.
  • 1958: Wuhan Iron and Steel (Group) Corp (WISCO) founded in 1958.
  • 1959: Open hearth furnace No.1 put into production at Qingshan.
  • 1963: Qingshan heavy steel rolling mill project completed.
  • 1970: WISCO production of iron & steel reaches 1 million tons.
  • 2005: Acquisition by Wuhan of 51% equity of Liuzhou Iron & Steel.
  • 2006: Chinese wire rope m/f jv agreed with Wire Corp of America.
  • 2007: Plan for integration of Kunmin Steel by WISCO agreed.
  • 2008: WISCO sets up trading office on US West Coast.
  • 2009: Acquisition announced of Echeng Iron and Steel by WISCO.
  • 2009: Commissioning by Liuzhou Steel of new convertor at Nanning.
  • 2012: Long-term export cooperation agreement signed with POSCO.
  • 2012: Purchase completed by Wuhan of remaining equity of Liuzhou.
  • 2012: Wuhan Steel drops plans to build Brazil steel mill.
  • 2012: Agreement to buy ThyssenKrupp's tailored blanks division.
  • 2013: Wuhan in talks to develop iron ore project in West Africa.
  • 2014: First shipment made of iron ore from Liberia.
  • 2015: Anti-corruption agency investigates former chairman Deng Qilin.
  • 2015: Reported interest in privatisation of PSM.
  • 2015: Concern emerging about status of WISCO foreign investments.
  • 2016: Start-up expected of new 8.6 mt/yr steelworks Fangchengang.
  • 2016: Merger takes place of Baosteel and Wuhan Iron & Steel
  • 2017: Ex-chairman Deng Qilin imprisoned for 15 years for fraud.
  • 2017: For subsequent developments, see Baowu history page

Notes
  • 1955: WISCO started civil work at its Qingshan plant. This step symbolised the birth of the first 'steel city' in new China.
  • 1974: New steel mill equipment was introduced from the former Federal Republic of Germany and from Japan. This set a precedent for the introduction of modern foreign technology to the Chinese Iron and Steel Industry, as was therefore a notable step for the industry.
  • 2005: Wuhan Iron & Steel Group, China's third-biggest steelmaker at the time, agreed in December 2005 to pay 6.5 billion yuan (HK$6.2 billion) for 51 percent of state-owned Liuzhou Iron & Steel Group.
  • 2012: The plans to build a steel plant in Brazil were dropped after negotiations on infrastructure investment [railways and port terminals] floundered, according to a Wugang spokesman.
  • Remaining Liuzhou equity stake was ~49 per cent.
  • 2012: The acquisition by Wuhan of TKS's stamping assets marked China's entry into German steel-rolling.
  • 2013: These talks concerned the Mbalam iron ore project, which straddles the border between Cameroon and The Republic of Congo and has a planned annual capacity of ~35 million metric tonnes of the steelmaking raw material.
  • 2014: Liberia Bong Mines was the first overseas iron ore mines to be developed by WISCO. WISCO Sino-Africa (HK) Mining Co. Ltd celebrated making its first shipment of iron ore fines to WISCO in February 2014.
  • 2015: Deng Qilin, Wuhan chairman until June 2015 (and former secretary-general of the China Iron and Steel Association) was alleged to have committed serious 'violations of discipline' in August 2015. 'Disciplinary violation' is common shorthand in China for graft.
  • 2015: Representatives from WISCO reportedly took part in discussions relating to the privatisation of Pakistan Steel Mills in October 2015.
  • 2015: WISCO foreign investments include iron ore mines in Brazil and in Canada. WISCO controlled up to 20 percent of MMX Mineracao & Metalicos SA, which owns iron ore mines in Brazil and Chile but which went bankrupt at end-2014. WISCO is also a business partner with U.S. mining company Cliffs Natural Resources Inc., operator of the Bloom Lake mine in Quebec, which in suspended production in early 2015.
  • 2016: This refers to the planned commissioning of a new greenfield integrated steel plant at Fangchengang Port, a project estimated to cost ~$9.5 billion.
  • 2016: Upon merger of Baosteel and Wuhan Iron and Steel, the 52-year-old chairman of the Wuhan Iron and Steel Group Mr Ma Guoqiang becomes the new chairman of the merged entity.
  • 2017: Wuhan former head Deng Qilin sentenced by Intermediate People's Court in Foshan to 15 years in prison and fined five million yuan on bribery charges.