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Steel production remains depressed by 19.9% for the year

Steel production remains depressed by 19.9% for the year

Steel production remains down 19.9% for the year

The Bop Shop at U.S. Steel's Gary Works mill in Gary is pictured above. 

Steel production has dropped by 19.9% for the year, while steel capacity utilization is down by 20 percentage points as compared to the same time last year, largely as a result of the coronavirus pandemic that greatly gutted demand for steel in the short term.

Great Lakes steel production rose by 9,000 tons last week, according to the American Iron and Steel Institute. Steel mills in the Great Lakes region, clustered mainly in Northwest Indiana, made 462,000 tons of metal, down from 471,000 tons the previous week, a 1.9% decrease.

While Blast Furnace D at ArcelorMittal Burns Harbor exploded in an industrial accident a few weeks ago, U.S. Steel brought Blast Furnace No. 8 at Gary Works back online two weeks ago. The blast furnace, which can make up to 3,300 tons of pig iron per day, had been idled in late August of last year because of deteriorating market conditions.

ArcelorMittal has since announced it will repair the blast furnace in Burns Harbor in a few weeks and bring another blast furnace back online at its Indiana Harbor steel mill in East Chicago.

Overall, domestic steel mills in the United States made 1.328 million tons of steel last week, up 0.6% from 1.32 million tons the previous week but down 28.1% as compared to 1.846 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 indefinitely idle blast furnaces. But auto plants across the country have come back online and have been slowly increasing production volume, leading Gary Works to recently restart Blast Furnaces No. 6 and 8.

So far this year, domestic steel mills in the United States have made 46.1 million tons of steel, a 19.9% decrease compared to the 57.5 million tons made during the same period in 2019. 

U.S. steel mills have run at a capacity utilization rate of 66.2% through Aug. 1, down from 80.9% at the same point in 2019, according to the American Iron and Steel Institute.

Steel capacity utilization nationwide was 59.3% last week, which was up from 58.9% the previous week but down from 79.3% 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 515,000 tons in the week that ended Saturday, down from 524,000 tons the week before. Volume in the rest of the Midwest rose to 145,000 tons last week, up from 129,000 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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