Photo/Illutration Eiji Hashimoto, chairman and chief executive officer of Nippon Steel Corp., speaks during an interview on July 8. (Kotaro Ebara)

Nippon Steel Corp. will construct a new mill in the United States through U.S. Steel, its subsidiary, as it seeks to close the gap on global leader China Baowu Steel Group Corp., its chief executive said.

“We cannot allow Chinese rivals to catch up in cutting-edge technologies,” Eiji Hashimoto told The Asahi Shimbun in a recent interview. “Toward that end, we need to expand production volume.”

Japan’s top steelmaker, which acquired U.S. Steel for about $14 billion (2 trillion yen) in June, will begin investing in the new U.S. mill by 2028.

It will be the company’s first new plant after the one it built in Oita Prefecture in 1971.

Nippon Steel, which led the world in crude steel output from the 1970s to the 1990s, ranked fourth in 2024 at about 44 million tons.

The same year, China Baowu Steel Group produced about 130 million tons, followed by Europe-based ArcelorMittal SA, which generated about 65 million tons.

Nippon Steel plans to more than double its crude steel output to at least 100 million tons within 10 years by bolstering operations at U.S. Steel, an Indian joint venture and a manufacturing base in Thailand.

In the process, Hashimoto, who is also chairman of the company, said he intends to propel U.S. Steel back to the top of the American steel industry.

U.S. Steel, which produced about 14 million tons of crude steel last year, was the third-largest player in the United States.

In addition to building the new mill, Nippon Steel plans to enhance capacity utilization at existing plants and implement other measures to raise U.S. Steel’s crude steel output to at least 34 million tons in 10 years.

Employees who were involved in the construction of Nippon Steel’s last plant a half-century ago no longer remain with the company.

Hashimoto said engineers and other workers will be sent to the United States and trained for the construction of the new mill.

Nippon Steel, meanwhile, is scaling back operations in China, the world’s largest steel market.

Last summer, the company announced the discontinuation of an automotive steel sheet joint venture with Baoshan Iron and Steel Co., a subsidiary of China Baowu Steel Group.

With relations between the United States and China becoming increasingly strained on economic and national security issues, Hashimoto is accelerating a shift toward the United States.

“In business, we lose unless we stand by someone who formulates international rules,” he said. “When we must choose between the United States and China, it is taken for granted that Japan will side with the United States.”