OREANDA-NEWS. September 13, 2011. Mitsui & Co., Ltd. ("Mitsui", head office: Chiyoda-ku, Tokyo, President and CEO: Masami Iijima) has signed a joint venture agreement with OAO Severstal ("Severstal". head office: Cherepovets, Volodga Region, Russia, CEO Alexei Mordashov) to establish a new steel service center for automobile steel in Leningrad Oblast, close to St. Petersburg, the second largest city in the Russian Federation. The charter capital of the new service center will be 970 million rubles (approximately 2.5 billion yen), and operations are targeted to begin in the middle of 2013. The annual capacity of this service center will be 170,000 MT. With this agreement, Mitsui will be the first Japanese trading company to participate in a steel service center in Russia.

Russia's automotive sales temporarily declined after the world financial crisis. However, they are expected to increase to 3 million vehicles in 2016, making Russia's automotive market the 7th largest in the world. Many foreign car manufacturers are located in the Russian northwest area, and with the Russian government promoting local procurement, demand for steel processing is anticipated to grow.

With Mitsui's worldwide experience operating steel service centers and Severstal's stable steel supply and technical capabilities, Mitsui and Severstal will combine their strengths to participate in the development of the Russian automotive industry and strengthening of the steel service center base in the Russian market.