The prolonged steel oversupply in Asia, largely driven by Chinese exports, may be approaching its end, according to senior management at Nippon Steel, raising expectations of potential market stabilisation.
Chief Financial Officer Takahiko Iwai said Chinese steel exporters are increasingly struggling to maintain profitability overseas, as regional markets remain oversupplied and trade restrictions limit export destinations. Although China’s overall steel production declined last year, exports rose by 7.5% to a record 119 million metric tons in 2025, as producers sought to offset weak domestic demand linked to the property sector downturn.
Rising protectionism has prompted countries including Vietnam, South Korea and Australia to introduce antidumping measures, while Japan has launched investigations into certain Chinese and South Korean steel products, including hot-dip galvanized coil, sheet and strip. China has attempted to redirect shipments to less restrictive markets such as the Middle East, but a broad steel export licensing system introduced on January 1 may constrain future volumes.
Iwai noted that the Asian steel market may be “nearing the bottom,” though he did not provide a timeline for recovery.
Separately, Nippon Steel is reviewing financing options as a JPY 2 trillion ($13 billion) bridging loan, used to fund its $14.1 billion acquisition of US Steel, approaches maturity in June. The outstanding balance has been reduced to approximately JPY 1.3 trillion, but total interest-bearing debt doubled to JPY 5.3 trillion by December 2025. While market speculation points to a possible JPY 500 billion convertible bond issuance, the company said no final decision has been taken.
VietnamSteel by Hoa Sen Group
