President Trump Wisely Moves Closer to a Nippon Steel Deal

SEATTLE (Scrap Monster): Americans may disagree about many things, but we should all be able to agree that it is critical that we maintain a powerful domestic steelmaking industry.

Steel is the backbone of many things, from skyscrapers to cars, from cutlery to appliances. The United States was once the envy of the world, producing so much steel that nobody else could come close. But, in recent decades, foreign competitors have overtaken American steel production, most notably China.

This is why it is good news that President Donald Trump wants a fresh national security review of Nippon Steel’s proposed investment of nearly $15 billion into U.S. Steel. Foreign investment in the U.S. economy is important and a way to boost domestic production of steel and other products.

The president recently ordered the Committee on Foreign Investment in the United States (CFIUS) to review the transaction again. This group assesses foreign investment as a national security matter rather than endangering it. In this case, there can be no doubt that Japanese investment is positive for national security reasons.

There is reason for optimism, because the Biden Administration used the CFIUS as a political tool to block the deal, then ordered the deal skuttled on January 3, 2025. The Trump White House released a memorandum on April 7, 2025 ordering the CFIUS to “conduct a review of the acquisition of U.S. Steel by the Purchasers to assist me in determining whether further action in this matter may be appropriate.” This gives many hope that some deal may be forthcoming and a fair review will be conducted.

Japan is a close military and economic ally and is just as interested in countering a rising China as we are. The proposed investment would secure critical supply chains for American companies that use steel, making these supply chains shorter and even more resilient.

Nippon’s investment would boost other American industries, including American automotive manufacturers who are facing plenty of price pressures for inputs and raw materials right now. The Japanese investment would help U.S. Steel grow its existing business and expand its footprint and product offerings.

Both companies involved want the deal. In a joint statement this year, they wrote: “Nippon Steel is the only partner both willing and able to make the necessary investments – including at least $1 billion to Mon Valley Works and approximately $300 million to Gary Works as a part of $2.7 billion in investment that it has already committed – to protect and grow U. S. Steel as an iconic American company for the benefit of the communities in which it operates and the entire American steel industry.”

Far from a hostile takeover, this is a joining of willing partners to help improve steelmaking for everyone.

Nippon’s investment would also grow the overall economy. The Japanese investment aims to create good jobs here in the U.S. The company has no plans to move any production to Asia. It’s stated goal is to grow U.S. Steel into the best, strongest, and cleanest steelmaker in the United States, providing high-quality American-made steel products to U.S. customers in critical industries. Nippon has the technology to do just that, with high-tech furnace design and specialized techniques that haven’t been used in the U.S. until now.

Trump will hear from CFIUS experts, but he should also pay attention to what American workers say. “Nippon Steel’s commitments include at least $2.7 billion that will be dedicated to improving steel facilities that employ USW-represented workers like me” a group of Pennsylvania steelworkers wrote this year. “The committed upgrades will breathe new life into our assets and a certain future for thousands of union jobs across the United States.”

The Biden administration had many opportunities to get this deal done, but Joe Biden couldn’t do it. He waffled and listened to a handful of union “leaders” who didn’t seem to speak for the employees they pretended to represent. He eventually tried to kill the deal but we are lucky that he only ended up leaving it for President Trump.

The stock market wants the deal, the employees want the deal, and the companies want the deal. There is no doubt that, after his complete review wraps up in a few weeks, Trump will see the logic of moving forward with this deal and will act decisively, as he always does. Then Americans will have another reason to thank Donald Trump.

 Courtesy: www.realclearmarkets.com