Nippon Steel Projects Surging U.S. Market to Drive U.S. Steel Profit Growth Beyond Forecasts

By Yuka Obayashi and Kentaro Okasaka

TOKYO, June 18 (Reuters) – Nippon Steel, the world’s third-largest steel producer, anticipates sustained strength in the U.S. market through 2027, driven by import tariffs and resilient demand, which could elevate U.S. Steel’s earnings beyond current projections. Vice Chairman Takahiro Mori emphasized that the favorable conditions, including hot-rolled steel sheet prices exceeding $1,200 per metric ton—more than double levels in Asia—position the company to capitalize on its renewed production capacity.

“We are confident that U.S. Steel will achieve profits surpassing 100 billion yen ($624 million) this year,” Mori stated, noting that the outlook supports a long-term annual profit target of 300 billion to 400 billion yen. Following its $14.9 billion acquisition of U.S. Steel in 2023, after an 18-month regulatory battle, Nippon Steel has deployed approximately 100 staff from Japan to oversee 260 operational improvement initiatives. These efforts aim to enhance productivity and synergies, with about one-third of the $11 billion investment plan approved by U.S. Steel’s board through 2028.

Mori acknowledged challenges such as inflation-driven cost pressures and labor shortages but highlighted that the U.S. government, holding a golden share, has not interfered in management decisions since the acquisition closed. Despite global uncertainties, Nippon Steel remains committed to overseas expansion, focusing on the U.S., India, Thailand, and Europe. The company aims to increase overseas profits to over 500 billion yen by 2030, nearly fivefold from 2025 levels.

He underscored the importance of aligning with national industrial policies and building ties with policymakers to navigate structural shifts in global markets.

($1 = 160.2600 yen)

(Reporting by Yuka Obayashi and Kentaro Okasaka; Editing by Thomas Derpinghaus)

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