UNITED24 - Make a charitable donation in support of Ukraine!


Nippon-Kokan Kabushiki Kaisha [NKK]

Japanese steel giant JFE Steel, created in 2001 through the merger of Kawasaki Steel Corporation and NKK Corporation. In 2004, JFE merged the two companies’ trading arms, Kawasaki Steel’s Kowasho Corporation and NKK’s NKK Trading Inc., to form Shoji Trade Corporation. That company supports JFE Steel by sourcing and importing raw materials, and providing domestic sales, as well as export sales for the company’s finished steel products. NKK Corporation was one of the world's largest steelmakers and Japan's second largest. In addition to steelmaking, the company is active in engineering, urban development, and electronics.

By 1881 new shipyards were operating under private ownership. Government support of the shipyards, provided through subsidies and the awarding of contracts, cushioned the early years, but strict regulation of business and industry was enforced from the start. The need for iron and steel to support a military and naval buildup heightened as Japan waged war with China in 1894 and 1895. The shipbuilding industry, for example, was hampered by the fact that most of Japan's iron and almost all of its steel had to be imported. In 1896 the government decided to establish an iron and steel industry. The Yawata works opened in 1901.

Processing plants were needed to turn the Yawata works' pig-iron and steel into products that shipbuilders, engineering companies, and other heavy industries required. Pipe, for example, was in increasing demand. Nippon-Kokan Kabushiki Kaisha was established in 1912 as Japan's first privately owned steelmaker. In June 1912, Nippon Kokan K. K. (later NKK and now JFE) was established as Japan's first seamless pipe manufacturing company. The first seamless pipe mill was built in Watarida (Kawasaki) in 1913 and began commercial production in April 1914. During World War I, Nippon Kokan increased its range of products to steel bars, heavy plates and steel sheets. The No.2 Pipe Mill was also constructed to produce smaller diameter pipes.

Although JFE Shoji Holdings was formed only in 2004, it started out as one of Japan’s leading trading companies, with roots reaching back through much of the 20th century. The oldest part of the new company was NKK Trading, the trading subsidiary of NKK Steel founded in the 1920s. The other half of Shoji Trading came from Kowasho Corporation, founded in the 1950s as part of Kawasaki Steel.

Through a merger, Nippon Kokan went into the shipbuilding business in 1940, acquiring the Tsurumi Steelmaking and Shipbuilding Company. As Japan went to war with the United States the following year, plans for a 5,000-ton capacity shipbuilding berth at the company's Shimizu shipyard went forward; the project was completed in 1943. In 1943, the first Pilger Mill was built in Watarida, but NKK, located in the Keihin Industrial Area of Japan was severely damaged by wartime bombing. By the end of World War II, only a fraction of the rolling mills remained in operation. As part of the country's reconstruction, in 1948 the Japanese government adopted a 'priority production system' policy to drastically increase production of basic materials like steel and coal.

By the end of the 1950s, NKK had launched a drive to develop an international presence. At the same time, NKK launched a vertical integration strategy, designed to give it control over the entire steel-making process, from raw materials to finished products. As part of that strategy, NKK moved to take over its trading partner, buying a 50 percent stake in Fuji Shoji in 1973. The trading company was then merged into NKK’s own trading operation, Kokan Shoji, and both operations were reorganized under the Fuji Shoji name.

Japan experienced unprecedented economic growth in the 1960s spurring steel production. In April 1966, Marubeni merged with Totsu Co., LTD., which was a trading company specializing in metals and one of sales agents of Nippon Kokan K.K. (now NKK) (merger was registered June 1). Marubeni-Iida succeeded to the employees and commercial supremacy of that company. The merger with Totsu created a close relationship between Marubeni-Iida and Nippon Kokan and strengthened Marubeni-Iida's previously weak metals division such that in 1966 the sales of the metals division were double that before the merger and rivaled those of the textiles division.

In 1970, NKK made a major investment in seamless pipe mills, installing a hot extrusion mill and a stainless cold drawn, to expand the range of products and sizes as well as to increase capacity. The company reorganized its divisions in 1979. Initially, the shipbuilding division, including the ten-year-old Tsu shipyard, was combined with the engineering and construction division. The following year, however, a further reorganization of the heavy industries division resulted in a three-division system: energy, heavy industries, and shipbuilding. In the 1980s, NKK shifted company strategy from mass-production of standard products and sizes to higher value-added products such as 13% CR , corrosion resistant steel pipes and drill pipes.

Tsu Shipyard of Nippon-Kokan Kabushiki Kaisha was one of three shipyards of the NKK industrial complex, which includes, in addition to the Shipbuilding Division, a Steelmaking Division and a Heavy Industries Division. The Steelmaking Division is one of the worlds largest. The Tsu Shipyard was started in 1968 to spearhead a new era in shipbuilding, with a facility having a capacity for building ships of 500,000 dwt; one of the largest in the world. The shipyard features CANALOCK - the worlds first dual-end dock system. This revolutionary new system permits the construction of a 500,000 dwt ship together with additional bow or stern sections. It allows ships ranging in capacity from 200,000 to 250,000 dwt to be built in tandem and launched from opposite ends of the dock. Planning of the yard was based on building six of the 250,000 dwt ships per year. In the early 1980s the yard diversified and constructed various smaller ships, product carriers, LPG carriers and offshore structures.

Join the GlobalSecurity.org mailing list

Page last modified: 04-08-2012 19:03:27 ZULU