- EAF expansion supports low-carbon steel production
- Digital system to streamline scrap purchasing process
Nippon Steel is restructuring its scrap procurement strategy as it prepares for the commissioning of large-scale electric arc furnaces (EAFs) in the second half of 2029, aiming to secure a stable supply of high-quality ferrous scrap for low-carbon steel production. The steelmaker plans to install a new 2 mnt/year EAF at its Yahata Works in Kyushu and expand the capacity of its Hirohata Works EAF to 500,000 t/year. Both facilities will focus on producing high-grade steel, making scrap quality and procurement efficiency critical to future operations. To strengthen raw material sourcing, Nippon Steel has introduced a new procurement framework featuring company-specific quality standards based on impurity levels, particularly copper content. The proposed standards were presented to around 1,000 scrap dealers nationwide through designated trading companies. Following industry consultations through the second half of 2026, the company aims to finalize the standards by the first half of 2027. Under the new classification system, scrap will be divided into two categories: “designated products,” graded according to copper content, and “open products,” classified by size and dimensions. Scrap containing up to 0.07% copper will qualify as Shindachi grade, while material with up to 0.15% copper will be classified as HS grade. Impurity levels will be verified through testing at the company’s existing blast furnace facilities. Nippon Steel also plans to overhaul its purchasing system by shifting from plant-level procurement to centralized procurement managed by its headquarters. While individual steelworks will continue handling some contracts during the transition, the company intends to gradually unify procurement through a digital management system. Existing procurement through approximately 10 designated trading companies will remain unchanged. The initiative forms part of Nippon Steel’s broader decarbonization strategy, aimed at significantly reducing carbon dioxide emissions through greater EAF-based steel production while expanding the supply of its low-carbon GX Steel products. By strengthening quality control and centralizing procurement, the company seeks to establish a reliable supply chain capable of securing several million tonnes of premium-quality scrap annually to support future production requirements. This article has been published in accordance with a content exchange agreement between Japan Metal Daily and BigMint.
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