With Nippon Steel’s current roadmap showing no substantial emissions reductions between today and 2040 – the most critical period for climate action – the company is creating unnecessary business and climate risk by delaying investments in low-emissions steel production, according to a new assessment of the company’s climate performance.
SteelWatch’s Nippon Steel Corporate Climate Assessment 2025 shows that, despite the company having many opportunities globally to pursue near-zero emissions iron and steelmaking, its leadership is stuck in an outdated coal-based production mentality that is unfit for the global company they want to build.
Nippon Steel currently consumes approximately 25Mt of coal annually, and has investments in coal mines with a total annual production capacity of 69Mt. Its recent acquisition of a 20% interest in the Blackwater coal mine in Australia adds an additional 10Mt of annual supply capacity, which gives Nippon Steel a comparable coal footprint to pure coal companies, such as BHP Mitsubishi Alliance with its 60Mt/yr.
Nippon Steel’s existing 2030 decarbonisation target (-30%) was already significantly less than Japan’s national one (-46%) when it was set in 2021, and the national target has now been increased to a 60% cut in GHG emissions by 2035, rising to 73% by 2040 compared with 2013 levels. The company’s flagship Super COURSE50 technology is only expected to be able to reach 50% reductions in the 2040s at the earliest. This leaves the company falling well short of its climate responsibilities, and indicates that it intends to continue coal use indefinitely.
“With its focus on technology to only partially reduce emissions at coal-based production facilities, its increasingly large investments in Australian coal mines, and its promise to prolong blast furnace production at U S Steel plants during its acquisition bid, Nippon Steel is looking more and more like a coal company that also makes steel."
Roger Smith, Asia Lead at SteelWatch.
“With its focus on technology to only partially reduce emissions at coal-based production facilities, its increasingly large investments in Australian coal mines, and its promise to prolong blast furnace production at U S Steel plants during its acquisition bid, Nippon Steel is looking more and more like a coal company that also makes steel,” said Roger Smith, Asia Lead at SteelWatch.
Smith continued, “Nippon Steel’s assurances that it is committed to decarbonisation will ring hollow until it aligns its climate targets with the 1.5C limit and announces transformative plans for a complete phase-out of coal-based production. There is tremendous potential to replace coal by investing in green iron supply chains in regions with abundant renewable energy, such as Australia and Canada.”
Right now, Nippon Steel is attempting to satisfy growing demand for green steel with accounting tricks, self-certifying coal-based steel as “green”. It has ignored shareholder calls for greater action on climate change, and is overdue on an update to its climate plans. More stringent interim targets and greater implementation of low-emissions technologies in the 2030s will be necessary to keep it in line with investor expectations and global competitors.