Nippon plans to double steel output at USS operations: Report

Nippon is Japan’s largest steelmaker and has made its goal clear: To reach 100 million metric tons (mt) of global crude steel production capacity.

The acquisition of U.S. Steel, finalized last month, brings Nippon’s global capacity to ~86 million mt.

To reach the 100-million-mt goal, the Japanese steel conglomerate plans to bolster its operations globally, focusing on an Indian joint venture, its manufacturing base in Thailand, and U.S. Steel.

Last year, USS produced ~14 million mt of crude steel, making it the third-largest US steelmaker. (Globally, Nippon was the fourth-largest steelmaker, with ~44 million mt of output.)

Now, Nippon wants to raise the Pittsburgh-based steelmaker’s annual output to at least 34 million mt over the next 10 years, according to the article.

In the interview with The Asahi Shimbun, Hashimoto said he “intends to propel U.S. Steel back to the top of the American steel industry.”

To achieve that, Nippon plans to build a new greenfield mill and enhance capacity utilization at existing USS facilities, among other measures.

Previous reports have stated the investment for a new domestic USS mill would be ~$4 billion, which would include $1 billion for the initial investment and another $3 billion in costs for completion after 2028. This would also be part of the $11 billion in new USS investments Nippon pledged to make by 2028 in order to finalize the USS partnership/purchase.

Neither Nippon Steel nor U.S. Steel responded to requests for additional information about the expansion plans.

Overcapacity in the Chinese steel industry and strained economic relations with China have prompted the Japanese company to shift gears, the article said, with a greater focus on the US.

“In business, we lose unless we stand by someone who formulates international rules,” the article quoted Hashimoto as saying. “When we must choose between the United States and China, it is taken for granted that Japan will side with the United States.