TOKYO, July 16 (Reuters) - Nippon Steel Corp, the world's second-biggest steelmaker, plans to roughly double its stake in affiliate Nisshin Steel Co to up to 20 percent to strengthen the group's stainless steel business, the Asahi newspaper reported on Thursday.
Stainless steelmakers have been suffering tough market conditions as prices of nickel, a raw material for stainless steel, have plunged amid the economic downturn, while competition from Chinese companies has intensified.
Nisshin owns a 15 percent stake in one of the world's biggest stainless steelmakers Acerinox SA of Spain.
Nippon Steel said in a statement that nothing had been decided on strengthening capital ties with Nisshin, Japan's fifth-biggest steelmaker. (Reporting by Yuko Inoue)