U.S. steel production up 3 percent in '12

2013-01-04T16:00:00Z U.S. steel production up 3 percent in '12Bowdeya Tweh bowdeya.tweh@nwi.com, (219) 933-3316 nwitimes.com
January 04, 2013 4:00 pm  • 

Production of raw steel in the United States is expected to have increased about 3 percent in 2012 from a year earlier, according to early estimates from the American Iron and Steel Institute.

Thomas Gibson, president and CEO of the Washington-based trade association representing the interests of the North American steel industry, said steel production last year is expected to grow for the fourth consecutive year. Domestic mills produced 95.2 million tons of raw steel in 2011.

Apparent U.S. steel consumption is expected to have risen 3.7 percent to 110 million tons in 2012.

"Steel is doing a little bit better than the economy as a whole, but it's still a fragile recovery," Gibson said.

However, the 2012 level remains less than the 100 million-ton mark exceeded in each year between 2002 and 2008. During those seven years, the average capacity utilization rate was 87.4 percent.  

Finished steel imports represented about 24 percent of the domestic steel market, according to an AISI analysis of U.S. Department of Commerce steel import permit applications. Total steel imports based on permit applications in 2012 was about 33.3 million tons, which was about 17 percent from a year earlier.

Gibson said producers are concerned that import levels are rising faster than steel production to support the small growth in steel consumption.

"We are very concerned that in a still fragile, recovering economy, imports, especially unfairly trade imports from places like China, are penetrating this market" at the expense of domestic producers, Gibson said.

David Phelps, president of the American Institute for International Steel, a trade association supporting free trade, said in a statement that the higher level of imports reflect the improvement in the U.S. steel market.

In order to boost activity within the steel industry, Gibson said it's up to Congress and the Obama administration to adopt pro-growth policies and enforce trade laws.

Raw steel production in the country's Great Lakes region was 683,000 tons in the week that ended Dec. 29, according to estimates from the American Iron and Steel Institute.

Production was up 4,000 tons from the week prior. The majority of raw steel production in the Great Lakes region occurs in Indiana and the Chicago area.

Production in the Southern District was estimated at 612,000 tons during the period that ended Dec. 29, down from about 635,000 tons a week earlier.

Domestic mills produced about 1.83 million tons of steel last week, down 1.9 percent from the same period in 2011.

U.S. steel mills had a capacity utilization rate of 73.9 percent last week, which is down from a 74.5 percent production rate a week earlier.

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