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Steel production down 20.3% this year

Steel production down 20.3% this year

Steel production down 20.3% this year

Hot-rolled coil at a Steel Dynamics mill. Steel production has plummeted by 20.3% this year.

Steel production has dropped by 20.3% for the year, largely as a result of the coronavirus pandemic that greatly gutted demand for steel in the short term.

Steel capacity utilization however continues to creep back up as production resumes and is now down by more than 17 percentage points as compared to the same time last year.

Great Lakes steel production dipped by 5,000 tons last week, according to the American Iron and Steel Institute. Steel mills in the Great Lakes region, clustered mainly in Northwest Indiana, made 466,000 tons of metal, down from 471,000 tons the previous week, a 1.9% decrease.

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U.S. Steel brought Blast Furnace No. 8 at Gary Works back online a few weeks ago and ArcelorMittal started back up the No. 4 Blast Furnace at the Indiana Harbor steel mill in Indiana Harbor. ArcelorMittal also is working to repair Blast Furnace D at ArcelorMittal Burns Harbor after it exploded in an industrial accident last month.

Overall, domestic steel mills in the United States made 1.377 million tons of steel last week, up 1.7% from 1.354 million tons the previous week but down 25.2% as compared to 1.841 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 North American steel, temporarily ceased production to limit the spread of COVID-19, forcing Northwest Indiana steel mills to idle some operations and temporarily lay hundreds of workers off. But auto plants across the country have come back online and have been slowly increasing production volume, leading local steel mills to restart their blast furnaces and ramp back up.

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So far this year, domestic steel mills in the United States have made 48.8 million tons of steel, a 20.3% decrease compared to the 61.2 million tons made during the same period in 2019. 

U.S. steel mills have run at a capacity utilization rate of 65.9% through Aug. 15, down from 80.7% at the same point in 2019, according to the American Iron and Steel Institute.

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Steel capacity utilization nationwide was 61.5% last week, which was up from 60.4% the previous week but down from 79.1% 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 548,000 tons in the week that ended Saturday, up from 538,000 tons the week before. Volume in the rest of the Midwest rose to 159,000 tons last week, up from 146,000 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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