Quicktake: Nippon Steel to Acquire US Steel
Nippon Steel has announced its acquisition of American steelmaker, US Steel, at a heavy premium (40%) compared to other bids in the sale process. The acquisition marks another step by Nippon Steel to offset declining production at home.
From a sustainability perspective, the steel market in the US is significantly more advanced than Japan’s, with over 70% of US steel produced by EAFs (compared to 26% worldwide), and a mature scrap steel market allowing for high recycled steel availability.
However, US Steel does not appear to be far ahead of Nippon Steel on decarbonisation. US Steel only expects to reduce emissions 20% by 2030, and of the 22.4 million tons of the company’s raw steel capability, less than 20% is from EAF production.
Much of what Nippon Steel has to learn and adopt from the steel market in the US does not seem well represented by US Steel.