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Postcard from a Japanese steel town

Adrian Ma Aug 1, 2018
The Nippon Steel & Sumitomo Metal plant in Kamaishi, Japan. Adrian Ma/Marketplace

Postcard from a Japanese steel town

Adrian Ma Aug 1, 2018
The Nippon Steel & Sumitomo Metal plant in Kamaishi, Japan. Adrian Ma/Marketplace

This story was updated on Aug. 2

Kamaishi, Japan, may be a long way from U.S.  steel cities like Pittsburgh and Cleveland, but they all have a lot in common.

Once upon a time, all were thriving hubs for steel production. Then globalization happened. Companies had to figure out how to compete and survive in the world marketplace, and the old ways of doing things didn’t quite work anymore.

Japan and the United States are still major players in steel. In the first seven months of 2018, Japan produced about 53 million tons of crude steel, making it the world’s No. 2 producer, according to the World Steel Association, while the United States produced roughly 42 million tons, putting it at No. 4, behind India. But those numbers don’t reflect the cycles of boom and bust that can come with being a steel town.

Kamaishi is the birthplace of Japan’s modern steel industry, the place where the country’s first “Western-style” blast furnace was built. But the people of Kamaishi, like folks in the traditional steel towns that dot America’s Rust Belt, know what it’s like to see a once-thriving industry fade away.

“We didn’t create this city”

The best way to get to Kamaishi is on the steel tracks of a passenger train. From Tokyo, it’s a six-hour ride north, up into the mountains, then down toward the coast.

When you get there, the first thing you are likely to notice as you walk out of Kamaishi Station is a giant green manufacturing plant. On its side, in big black letters, reads: “NIPPON STEEL & SUMITOMO METAL.”

Masaaki Hino is a manager at the Nippon Steel plant in Kamaishi.

The plant is large enough to hold 14 Tokyo Domes, according to Masaaki Hino, a manager at the plant. Inside, machines run nearly 24/7, extruding red-hot steel wire at a rate of 100 meters per second. After it’s coiled and cooled, it will be shipped around the world. One of the most popular applications for the wire, Hino said, is tire manufacturing. He added that a good chunk of what the plant produces is bought by U.S. companies.

Hino didn’t want to talk about the Trump administration’s current 25 percent tariff on Japanese steel products entering the United States. But he was eager to show off how automated the plant is. Today, it only employs about 300 people. But at its peak in the early 1960s, the number of employees was nearly 9,000.

At the time, the company (then known as Fuji Steel before it merged with Yawata Steel to become Nippon Steel in 1970) employed about 10 percent of the roughly 90,000 people that lived in Kamaishi. In Japan, they call company towns like these “castle towns.”

“When I was growing up in elementary school, I was living right by the plant, so I could see all the chimneys,” said Ikumi Kawahata, a historian at the Kamaishi Historical Materials Museum, who was born in 1964.

Life was good. The city was bustling, thanks in large part to Nippon Steel, Kawahata said. The company threw festivals and built sports fields that were shared with the public. And sure, there was a bit of air pollution. But if you wanted to get clean, you could always go to the public baths — also operated by Nippon Steel.

But then, in the 1970s and ’80s, the company restructured, moving many of its operations away from Kamaishi. The goal, according to company officials, was to streamline its supply chain, reduce costs and increase efficiency. The Japanese have a term for this: “rationalization.”

Kawahata remembers watching on TV as the chimneys from the old blast furnaces were torn down.

“It made me feel sad, because I thought, ‘We’re no longer ‘the City of Steel,’” she said.

In the decades that followed, Kamaishi lost about two-thirds of its population, going from over 90,000 residents in the 1960s to around 34,000 today. That wasn’t just a loss for the city’s economy, said Hisatada Maruki, director of the nonprofit Kamaishi Social Welfare Council. It was a blow to Kamaishi’s civic identity. 

“When [the steel jobs] left, that was the first time I realized, we didn’t create the city. Nippon Steel created it,” said Hisatada Maruki, director of the nonprofit Kamaishi Social Welfare Council. “But I’m not disappointed in this city. I see a lot of potential, especially for the younger generation.”  

“When they left, that was the first time I realized, we didn’t create the city,” Maruki said. “Nippon Steel created it.”

Learning to ride on two wheels

Although “rationalization” took a heavy toll on Kamaishi’s steel industry, the result has been an economy that is more diversified, if still largely dependent on manufacturing. In 1985, about half of all manufacturing jobs were steel-related, according to Shunichi Oyamada, chief of the business development section of Kamaishi’s municipal government. Today, however, the biggest employers are food processing companies and machine parts manufacturers, he said.

Even Nippon Steel also tried diversifying, at various points investing in various offshoot businesses that have included orchid growing, soy-meat production, caviar farming and furniture manufacturing. Eventually, in 2000, the company found a stable source of revenue in the form of coal-powered electricity generation.

When steel was the plant’s only source of income, said Hino, the Nippon Steel manager, “It was like riding on one wheel. Now, we have two wheels.”

By the mid-2000s, it seemed to some that Kamaishi had found its economic footing. But then, on March 11, 2011, a magnitude 9 earthquake caused a tsunami to rip through the city.

According to The Japan Times, over 1,000 people died and about 3,700 buildings were destroyed in the flood.

AEON Mall, built after a tsunami ripped through the city in March 2011, sits on land that Nippon Steel once used to store iron ore and coal. 

Still a “castle town”

Today, large swaths of the city are still rebuilding. The area around the mouth of Kamaishi Bay is a massive construction zone, with bulldozers and trucks at work reforming the terrain to mitigate the impact of a future flood. Down the road, some 240 families are still living in temporary housing that was erected shortly after the disaster on land owned by Nippon Steel.

Drive into the city’s downtown center though, and it’s a different picture. Nearly every building that was destroyed has been rebuilt with the help of nonprofits and subsidies from the local and national governments. A multistory shopping mall — perhaps the most conspicuous sign of the city’s recovery — stands on land that Nippon Steel previously used for storing coal and iron ore.

Looking at it, it’s hard not to think that Kamaishi is, in a way, is still a castle town. Nippon Steel has had an outsized role in the city’s rise, its decline and its recovery.

Still, Eiko Murakami, who runs a third-generation family seafood business located in the city’s main fish market, said the recovery hasn’t helped her business much.

“Everything looks brand new and well-constructed, but that’s just the outward appearance,” Murakami said. “Things are slow for us.”

“We’re a small store to begin with,” she said. “When these huge stores come in, it takes away our customers.”

But, she added, the biggest challenge for her is not a fancy new grocery store; it’s demographics. Like most cities in Japan, Kamaishi’s population is rapidly aging, the birthrate is down and its younger residents are moving away to urban centers.

Naoya Sasaki, left, and Ino Hasegawa are a year from graduating high school. Both say they want to attend college, which means they will have to leave Kamaishi. 

“I would definitely have to leave for my education,” said 16-year-old Ino Hasegawa. “There’s no college here.” Asked if she will return after finishing her education, she said she wasn’t sure.

“It’s comfortable here,” she said. People are “warmhearted.” One of the great things about Kamaishi, she said, is that “even though it’s changed a lot in recent years, the people have stayed the same.”

Still, Hasegawa said, she doesn’t know if she’ll be one of them.

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