Nippon Steel will likely idle more than two blast furnaces in an effort to remain profitable in Asia.

 

The continental steel market has softened, prompting the Japanese steelmaker to shut down two of its 15 Japanese blast furnaces by 2024.

 

Nippon predicts moderating demand because other Asian countries intend to satisfy their steel demands with domestic production. The world’s third-largest steelmaker also anticipates China to increase exports from its coastal cities. 

 

On Thursday, the company announced two of its subsidiaries, Nippon Steel Coated Sheet and Nippon Steel Nisshin A&C Co. Ltd., would merge by July 2020 to make it more competitive in the exterior building material steel sheet space.

 

In early November, it announced the integration and reorganization of its steelworks to ensure advances in its manufacturing capabilities, as well as enhanced autonomy and efficiency of manufacturing workplace. The restructuring involves consolidating Nippon Steel’s 16 domestic plants into six steelworks that will begin reporting to the conglomerate’s president in April 2020.

 

The company intends to expand into other countries either through acquisitions or joint ventures. It received good news last week when India’s Supreme Court approved a partnership between Nippon and ArcelorMittal to take over the bankrupt Essar Steel.

 

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