Nippon Steel forecasts steady growth in the US market

The company is also seeking to accelerate reforms at US Steel

Nippon Steel, the world’s third-largest steel producer, expects the US market to continue growing steadily thanks to import tariffs and robust demand. This could boost the profits of its subsidiary, US Steel, beyond current forecasts. Reuters reports this, citing the company’s vice-chairman, Takahiro Mori.

A year ago, Nippon Steel completed its $14.9 billion takeover of US Steel following 18 months of intense political and regulatory wrangling in Washington. Currently, around 100 specialists seconded from Japan are working on 260 initiatives to improve operational performance, implementing their own technological know-how to boost production efficiency.

Although the integration is already yielding positive results, Nippon Steel’s management is not yet fully satisfied with the pace of internal reforms.

“We are seeing improvements, but we are not yet satisfied,” Takahiro Mori said in an interview with the Nikkei.

Despite this, financial expectations for the US market remain high. According to Mori, the company is confident that US Steel will be able to generate a profit of over 100 billion yen ($624 million) this year, and the favourable market conditions through to 2027 point to further growth potential. In the long term, the company’s annual profit is expected to range from 300 to 400 billion yen.

Current conditions in the US are considered extremely favourable: prices for hot-rolled steel sheet exceed $1,200 per tonne, which is more than double the price level in Asia. To make the most of this market opportunity, US Steel restarted a previously idled blast furnace in Illinois in March, which is now operating at full capacity.

In parallel, US Steel’s board of directors has already approved approximately one-third of the $11 billion investment package pledged by Nippon Steel by 2028. The annual return on these investments is expected to rise to $3 billion by 2035. At the same time, the cost of modernising the Mon Valley Works plant in Pennsylvania may increase due to inflation, additional equipment requirements and environmental assessments. The company is also continuing to evaluate sites for the construction of new steelmaking facilities in the US.

Among the main risks to the business, Mori cited inflationary pressure on costs and labour shortages caused by competition for workers between large-scale projects. However, he emphasised that the US government, despite holding a ‘golden share’, had not interfered in any way with the company’s management decisions following the completion of the deal.

Overall, Nippon Steel plans to continue its active international expansion, focusing on the US, Indian, Thai and European markets. The Japanese giant’s strategic goal is to increase its overseas profits to over 500 billion yen by 2030, which is almost five times the figure for the 2025 financial year. According to the company’s deputy chairman, global structural changes are forcing businesses operating abroad to forge closer ties with politicians and align their investments with the national industrial policies of the countries concerned.

As reported by GMK Center, US Steel plans to build a $1.9 billion direct reduced iron (DRI) plant – the first of its kind in the US. The facility, to be built at the Big River Steel Works complex in Osceola (Arkansas), will supply DRI to the company’s electric arc furnaces. It will utilise DR pellets from US Steel’s Minnesota Ore Operations division.