Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Japan’s Nippon plans to start a new galvanizing line at Kimitsu in Q1 FY2021 to increase the production of ultra-high tensile strength steel sheets for the domestic automobile industry. The galvanizing line was earlier scheduled to start in Q2 FY2020 but was delayed amid sluggish demand due to the COVID-19 pandemic.


In H2 FY2020, Nippon expects crude steel production of 18.10mn mt. In H1, Nippon had cut production by 6.91mn mt to 14.64mn mt from H1 FY2019 in response to the pandemic. On improved demand outlook, the steelmaker had announced restart of a blast furnace (BF) at Muroran works and of No.2 BF at Kimitsu that was idled in June. 


The new continuous hot-dip galvanizing line (CGL No. 6) has a designed capacity to manufacturing 33,000mt per month. The line will produce hot-dipped galvanized steel and alloyed hot-dipped galvanized steel. The ultra-high tensile strength steel sheets produced by the new unit will be used for manufacturing auto structural parts. The application of high strength steel sheets helps reduce the weight of the automobile while securing crash-worthiness.


To enhance the company’s steelmaking capacity in Japan, Nippon is relining its No. 3 BF in Nagoya, which is also an integrated manufacturing base for auto sheets. It has also invested in improving its electrical steel sheet capacity and quality at Kyushu works Yawata and Setouchi works Hirohata. Nippon has plans to raise capacity outside Japan in India and the US, as reported by Davis Index. 

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