Jan. 06, 2025
Tadashi Imai
Representative Director, President and COO
Nippon Steel Corporation
Accomplishing the medium- to long-term management plan and making steady progress toward the world's best steelmaker with world-leading capabilities
As the big picture at the start of 2025, major conflicts continue in Ukraine and the Middle East, and their impact on the international economy is of concern. The political and economic confrontation between the United States and China will intensify, and the global economy will see many countries expanding trade policies prioritizing their own country in the name of economic security, and market decoupling is likely to become even more serious.
In the steel sector, the widening of the supply/demand gap, driven by the economic slowdown in China, will surely result in structural adjustments for a long period of time. Domestic steel demand has been decreasing, now down more than 40% from its peak in 1990 to approximately 50 million tons in the current fiscal year (ending March 2025). Given the declining and aging population in Japan, a recovery in domestic demand is unlikely.
Despite this extremely difficult situation, Nippon Steel was able to achieve its goal of exceeding 600 billion yen in underlying business profit. 2025 will be a year in which the company materialize further growth strategies in the form of the next medium- to long-term management plan. Although the company will continue to face a challenging business environment, Nippon Steel will take this as a test to demonstrate its comprehensive capabilities. Nippon Steel will start afresh to make its best efforts.
Concerning specific issues and policies for the future, in Nippon Steel’s core domestic steelmaking business, a series of production facilities structural measures will be completed as represented by the suspension of the one series of upstream facilities in the Kashima Area at the end of fiscal 2024, which will be carried through in a methodical manner. The core of Nippon Steel’s comprehensive strength is the fact that the company’s people in sales, manufacturing, and research work together, to fulfill their respective roles and responsibilities. We are determined to continue to enhance this strength and on that basis will strive to become the overwhelming number one in the steel markets in Japan and overseas.
In the overseas business, which is the growth engine of the group, Nippon Steel will continue to identify opportunities for excellent raw materials business, which already contributes greatly to its consolidated profits, while promoting a new comprehensive strategy for cold iron sources toward carbon neutrality. As for the overseas steelmaking business, Nippon Steel will focus on realizing the AM/NS India’s capacity expansion plan in India, where continues to experience steady economic growth Further, emphasis will be placed on reconstructing G/GJ Steel in Thailand, which is facing a particularly difficult situation in ASEAN due to the impact of Chinese steel products. The United States remains a growing market where our technological capabilities can be utilized. Although the U.S. President decided to block the acquisition of U. S. Steel, Nippon Steel will never give up on expanding business in the U.S. and will pursue all appropriate action, including protecting our legal rights. In order to outperform global competitors, with the realization of our 100 million ton, 1 trillion yen vision as a milestone, it is essential to expand our overseas business, focusing on what we consider to be important strategic regions.
In response to climate change issues, Nippon Steel will promote initiatives in line with Japan’s national industrial policies, and will do what is necessary to reduce CO2 emissions by 30% by 2030. In so doing, there are four challenges: Competitive technology development; energy and other industrial infrastructure development; predictability of capital investment recovery including market formation; and rulemaking such as international standardization of GX green steel based on the mass balance method. Nippon Steel will work with the government’s GX Implementation Committee and industry to tackle these four issues simultaneously.
In terms of safety, the environment, disaster prevention, and quality assurance, Nippon Steel will ensure the safety and security of employees and compliance based on the Management Principles of being a company that emphasizes the importance of integrity and reliability.
With its global growth strategy as unchanging basic policy, the entire Nippon Steel Group will make concerted unified efforts to take on the challenges in 2025, aiming for further growth even in the increasingly challenging business environment.