* Q4 net loss Y11.2 bln, after Y23.7 bln special loss
* No guidance for 2011/12 earnings
* Consensus estimate for 2011/12 net profit Y92.43 bln, flat yr/yr
* Unable to agree on coal pricing with BHP, buying from alternative suppliers
* Nippon Steel shares up 1.2 pct after results (Adds POSCO, JFE result, Nippon Steel comments)
By Yuko Inoue
TOKYO, April 28 (Reuters) - A stubborn decline in profit margin underlined Nippon Steel Corp's quarterly results on Thursday, although support came from cost cuts and strength in its non-steel operations, limiting the impact of earthquake-related losses at the world's No.4 steelmaker.
Asia's steelmakers face a double whammy of a jump in input costs and tepid demand caused by China's production boost, after the industry shifted to quarterly pricing of iron ore and coal, major inputs, from annual pricing last year.
"The Lehman crisis is behind us, but now we face a major challenge from a decline in profit margin," Shinichi Taniguchi, executive vice president at Nippon Steel, told a news conference.
"On top of the impact of quarterly pricing, Asia's export market didn't improve as much as we had expected, which made it hard for us to raise prices enough to offset higher input costs."
Nippon Steel, which competes with Asian firms including POSCO and Baosteel , booked a net loss of 11.2 billion yen ($136.2 million) for January-March, the fourth quarter of the 2010/11 financial year, hit by an extraordinary loss from the March 11 quake of 23.7 billion yen.
The decline came even as quarterly revenues jumped 8 percent from the preceding three months to 1,085 billion yen on increased shipments and higher sales in the chemicals business.
Revenues rose but pretax profit in the steel business suffered. It dwindled to 6.8 billion yen in the fourth quarter, down from 12.4 billion yen in the third quarter, 18.5 billion yen in the second quarter and 42.2 billion yen in the first quarter.
Taniguchi said the company and BHP Billiton , the world's biggest diversified miner and the biggest coal supplier for Japanese mills, are yet to agree on pricing of coking coal, after BHP this year proposed to shift pricing on a monthly basis instead of quarterly.
"We are increasing purchases from alternative suppliers, who agree to quarterly pricing," Taniguchi said.
Japanese steelmakers were largely unscathed by the March 11 devastating earthquake, but domestic steel consumption has slumped as automakers -- key buyers of steel -- have been forced to run at 50 percent of their target plans after the disaster savaged the sector's parts-supply chain.
Nippon Steel said it may cut crude steel output in April-June by 7 to 8 percent from the previous quarter, adding that boosting exports is an option if domestic demand remains weak.
Many analysts expect Japan's steel mills to tumble into the red on a pretax basis in the April-June quarter, unable to ask for large price hikes, despite a rise in costs of 15,000 yen ($182) per tonne during the quarter.
Nippon Steel's top domestic rival, JFE Holdings , also failed last week to give a profit forecast for the current year in reporting a 5.9 billion yen net loss for the fourth quarter.
Sumitomo Metal Industries Ltd , which plans to merge with Nippon Steel in October 2012, was worst hit by the earthquake and on Thursday booked a 42.07 billion net loss for the quarter.
POSCO , the world's No.3 steelmaker, last week reported a 36 percent fall in operating profit. It did not provide any profit target, but said its annual profit will be higher this year helped by price hikes. [ID:nL3E7FK0IM]
Shares of Nippon Steel closed up 1.2 percent after the results announcement, outperforming a 1.6 percent gain in the Nikkei average .
"The impact from the earthquake on Japanese steelmakers' earnings will likely be temporary, given that demand for automobiles remains strong worldwide. So Nippon Steel is a buy in the medium to long term," Masayuki Kubota, a senior fund manager at Daiwa SB Investments.
"There is currently a surplus of supply in Asia while input costs are rising, making it difficult for steelmakers to raise prices. So, investors are likely to take a wait-and-see stance for a while."
The average net profit forecast of five analysts who gave estimates after the disaster calls for Nippon Steel to post flat net profit of 92.43 billion yen in the year that began on April 1. ($1 = 82.220 Japanese Yen) (Additional reporting by Chikako Mogi, Editing by Michael Watson)