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Steel production down more than 20% with capacity utilization of just 65.8%

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Steel production down more than 20% with capacity utilization of just 65.8%

Steel coil is stacked at Alliance Steel in Gary. Steel production has fallen 20.1% this year, largely as a result of the coronavirus pandemic.

Great Lakes steel production dipped by 3,000 tons last week and remains depressed by more than a fifth so far this year, according to the American Iron and Steel Institute.

Steel mills in the Great Lakes region, clustered mainly in Northwest Indiana, made 527,000 tons of metal in the week that ended Sept. 19, down from 530,000 tons the previous week.

Steel production is down by 20.1% for the year, while steel capacity utilization has fallen more than 12 percentage points year over year, largely as a result of the coronavirus pandemic that greatly gutted demand for steel for much of the spring and early summer.

Overall, domestic steel mills in the United States made 1.446 million tons of steel last week, down 0.9% from 1.459 million tons the previous week and down 19.7% as compared to 1.801 million tons the same time a year prior.

Steel demand started plummeting in mid-March when automakers like Ford, General Motors and Honda — some of the largest consumers of steel in North America — temporarily ceased production to curb the spread of COVID-19.

It forced Northwest Indiana steel mills to idle operations and temporarily lay off hundreds of workers.

Auto plants across the country have come back online and ramped back up production volume, leading local steel mills to restart blast furnaces at Gary Works, ArcelorMittal Indiana Harbor and ArcelorMittal Burns Harbor. 

So far this year, domestic steel mills in the United States have made 56.17 million tons of steel, a 20.1% decrease compared to the 70.33 million tons made during the same period in 2019. 

U.S. steel mills have run at a capacity utilization rate of 65.8% through Sept. 12, down from 80.3% at the same point in 2019, according to the American Iron and Steel Institute.

Steel capacity utilization nationwide was 64.5% last week, which was down from 65.1% the previous week and down from 77.4% at the same time a year ago.

Steel production in the southern region, a wide geographic swath that encompasses many mini-mills and rivals the Great Lakes region in output, was 553,000 tons last week, down from 565,000 tons the week before. Volume in the rest of the Midwest dipped to 169,000 tons, down from 172,000 tons the week prior.

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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.

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