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Steel capacity utilization soars to nearly 80 percent

A bar of steel makes its way through the 80" hot strip mill at AcerlorMittal Indiana Harbor on its way to becoming a coil of steel.

Great Lakes steel production rose to 697,000 tons last week, a slight increase of 0.8 percent.

Steel mills in the Great Lakes region made 691,000 tons of metal the previous week, according to the American Iron and Steel Institute. Most of the steel made in the Great Lakes region is produced around the southern shore of Lake Michigan in Lake and Porter counties in Northwest Indiana.

Overall, domestic steel mills made 1.87 million tons of metal last week, up from the 1.858 million tons made the previous week.

U.S. steel mills have run at a capacity utilization rate of 77.3 percent so far this year, up from 74.6 percent at the same point in 2017, according to the AISI.

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Domestic steelmakers used about 79.8 percent of their steelmaking capacity in the week that ended Sept. 1, up from 75.4 percent at the same time a year ago and up from 79.3 percent a week prior, according to the American Iron and Steel Institute.

Some analysts say steel-making capacity utilization of about 90 percent is considered financially healthy for the industry, at least for the larger integrated mills like those around Lake Michigan in Northwest Indiana, because of their high fixed operating costs.

Nationally, as 25 percent Section 232 tariffs make imports more expensive, U.S. steel output is up by 4 percent so far this year, according to the American Iron and Steel Institute, a 0.1 percent increase as compared to the past week.

Production in the Southern district, a wide geographic swath that includes many mini mills, fell to 680,000 tons last week, down from 683,000 tons the previous week. Steel output in the greater Midwest rose slightly to 196,000 tons last week, up from 192,000 tons the previous week.

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.