Brussels: ArcelorMittal, the world’s largest steel maker, aims to implement a further $2 billion of cost cuts by 2012 and will spend $4 billion to make it more self-sufficient in iron ore over the next five years.
The savings over the next two years would come largely from an efficiency drive throughout its business, the Luxembourg-headquartered company said in investor day presentations released on its website on Thursday.
ArcelorMittal has already achieved $3 billion of what it describes as “management gains” since the financial crisis struck, largely by axing jobs.
The company’s head of mining told a Reuters Summit in March it planned to increase its iron ore production from its own mines to 100 million tonnes in 2015, a more than 50% increase from current capacity.
ArcelorMittal said on Thursday this would come at a cost of $4 billion.
Steel makers face increasing pressure from iron ore producers, notably after the latter forced a shift to quarterly contracts and away from fixing prices over an entire year.
The company also said it had revised its strategy in India. Instead of concentrating solely on two mega-projects, it would now focus on smaller hubs, with the first domestic production expected in 2013.