Japan: Nippon Steel’s crude steel production, steel shipments fall q-o-q in Q2FY’23

Japan’s leading steelmaker, Nippon Steel, has released its financial results for the quarter ending 30 September, 2022. The company has posted a decline in crude steel output and steel shipments during the quarter.

Although steel demand in tyhe construction, shipbuilding and industrial machinery segments is robust, Japan is facing a downward economic pressure due to prolonged cutbacks in auto production due to from chip shortage, raw material inflation, and the excessive depreciation in currenecy.

Highlights:

• Non-consolidated crude steel production stood at 8.34 mnt in Q2FY’23, down 4% compared with 8.69 mnt in the previous quarter. Production fell by 17% y-o-y as against 10.05 mnt in Q2FY’22.
• Non-consolidated steel shipments dropped 9% to 7.49 mnt in Q2FY’23 as against 8.19 mnt in Q1. Similarly, steel shipments fell 18% y-o-y compared to 9.09 mnt in the same period last year.

The steel major’s consolidated profit declined to JPY 202.8 billion ($) in Q2 versus JPY 338.8 billion ($) in the previous quarter due to a sluggish business environment. Also, the company aims to generate consolidated profit of more than JPY 870 billion in the current fiscal.

The company’s goal is to be carbon neutral by 2050. In line with this, commercial operations have commenced at the new EAF in the Hirohata area, which will produce high -grade electrical steel sheets to be used in automobiles. The reduction in CO2 emissions will be tracked and credited to NSCarbolex, which will be on sale from H1FY’23.

Expanding global crude steel capacity to 100 mnt/year: In line with its plans of expanding its crude steel capacity to 100 mnt/year, the company is planning to install new EAF steel mills in Calvert by 2023 and upstream facilities expansion by 2025-26. However, the company is also planning to shut the EAF stainless steel facility in Shunan and three BFs in Kashima by 2024.

Operations at Hazira, Gujarat: The operations at blast furnace no. 2 and related facilities, new oxygen converters and continuous casters as well as the new strip mill will start by the second half of 2025. Blast furnace no. 3 will start by the first half of 2026. Post expansion, the company’s crude steel capacity will rise from 9 mnt per annum to 15 mnt per annum.