Nippon Steel plans to invest $39 billion in expanding production by 2030

Nippon Steel, Japan’s largest steel producer, plans to invest 6 trillion yen (about $39 billion) over the next five years as part of its new medium-term business plan, according to a company statement.

The goal is to increase profits at home and abroad. The announced amount includes planned investments of about $11 billion in US Steel by the end of 2028.

Nippon Steel also expects to increase its global steel production capacity to 100 million tons per year or more by 2030 and aims to bring its profit, excluding one-off factors, to 1 trillion yen over the next five years.

According to the company, to achieve these goals in its domestic operations, it plans to increase profitability by further strengthening its revenue base. As for its overseas operations, the steel manufacturer intends to increase profits by implementing a global growth strategy in key regions (the US, Thailand, India), capital investment, and the maximum transfer of technological knowledge and know-how.

Nippon Steel also announced that it will begin construction of an integrated steel mill in southern India, in the state of Andhra Pradesh.

Regarding the outlook for steel demand, the company expects it to increase amid economic growth in India and other developing countries. At the same time, Nippon Steel predicts that the shift to domestic production in the US will increase demand for high-quality steel products.

In contrast, demand in Japan is likely to continue to decline due to population decline, the relocation of manufacturing industries overseas, and other factors.

On the supply side, according to the Japanese steel producer’s estimates, China’s high level of domestic production and aggressive export position will remain unchanged, raising concerns about escalating trade tensions. The company expects that it will take more time to resolve the current steel surplus issue and that the business environment will remain challenging.

In November, US Steel presented an $11 billion investment plan in partnership with Nippon Steel. The parties identified measures to improve operational efficiency through the use of Nippon’s technologies in the US.