Nippon Steel in talks to acquire a steel mill in Southeast Asia

Japan's largest steelmaker, Nippon Steel Corp, is in talks to buy a steel mill in Southeast Asia to provide ironmaking resources for a growing market and boost its overseas expansion, a senior executive said.

“Negotiations are under way to protect ASEAN's iron sources,” Takahiro Mori, executive vice president of Nippon Steel, told Reuters.

He declined to comment on details, but said the deal could involve an electric oven.

In March, the world's No. 5 steelmaker said it may consider acquiring or investing in integrated steel mills in China and ASEAN countries to increase its global crude steel capacity to 100 million tonnes.

“One hundred million is a symbolic figure for us to have a definite presence and influence as a global steel company,” Mori said.

As of March, Nippon Steel's global production capacity was 70 million tonnes.

The company is expanding capacity at its Indian joint venture with ArcelorMittal SA and is building an electric furnace at its joint venture with ArcelorMittal in the United States.

Japan and the United States recently agreed to begin discussions aimed at addressing the issue of additional US tariffs on steel and aluminum imports from Japan, which is an irritant in trade relations between them.

“Our exports to the US are small, but they have nearly halved since the additional tariffs were imposed,” Mori said, pointing to seamless pipes and railroad tracks as being affected.