Steel Mills
New Mill Capacity and Equipment Update
Written by John Packard
October 6, 2019
With U.S. Steel buying almost 50 percent of Big River Steel and holding an option on the remainder over the next four years, SMU thought it an appropriate time to review the list of announced changes being made by the mills in the United States, Canada and Mexico. We reviewed this listing with the four mills who spoke on the subject at the 2019 SMU Steel Summit Conference in order to make sure we were not double counting or missing items.
The key for flat rolled buyers (and consumers) is the total tonnage of new flat rolled capacity (melt) being added to the market. Most likely there will be corresponding old capacity that will no longer be justified. With the move by U.S. Steel, that scenario became even more likely in the years ahead.
The key capacity additions (flat rolled) will be: Big River Steel 1.65 million tons, JSW Ohio (up and running) 1.5 million tons, North Star Bluescope 900,000 tons, Nucor Gallatin 1.40 million tons, and Steel Dynamics Texas 3.0 million tons. The total of these additions (compared to 2018) is 8.45 million tons. From this we need to recognize AK Steel removing 2.0 million tons from the market by shutting down Ashland Works. So the net gain is 6.45 million tons of new flat rolled melt production.
U.S. consumers of flat rolled should not overlook the Mexican steel mills who are building new facilities, as well. Ternium has 5.0 million tons of projects in the works, none of which are new melt. Even though they are not producing new steel, they will be moving slabs up from their slab mill in Brazil. In the process they will be adding at least 4.0 million tons to the Mexican market, a portion of which could make its way into the U.S. market.
At the time this chart was orginally produced, U.S. Steel was bringing back up their two furnaces at Granite City. I would ignore the 2.8 million tons mentioned there as this is existing production and not new melt.
When it comes to plate, there are two plants we need to look at: Nucor Brandenburg is building a new greenfield plate mill rated to produce 1.2 million tons. JSW Texas is building an EAF with a 1.0 million-ton capability, which will replace imported slabs. Therefore, the net gain in the U.S. will be 1.2 million tons of new plate capacity.
Even though SMU does not cover the long products markets, for our conference we did list the new mills being launched by a variety of mills.
John Packard
Read more from John PackardLatest in Steel Mills
USW seeks clarity on USS plans for Granite City Works
The United Steelworkers union has asked U.S. Steel to elaborate on its Granite City Works plans following reports that the steelmaker is ending processing at the facility.
Nucor maintains plate prices, opens October order book
Nucor aims to keep plate prices flat for a seventh straight month with the opening of its October order book.
ArcelorMittal Mexico to import from sister mills as it works to resume DRI production
ArcelorMittal has partially restarted operations at its direct reduction plant in Lazaro Cardenas, Michoacan. An explosion on Aug. 18 rocked the massive steelworks on Mexico’s Pacific coast, impacting production of direct-reduced iron (DRI).
Fall maintenance outages are coming in hot
Labor Day has passed, the sun is starting to set a little earlier each day, and cooler weather has begun to find its way down to many of us across North America. And you know what that means for the steel industry… Fall maintenance outages!
AISI: Domestic steel production ticks up
US raw steel production ticked up in the week ending on Sept. 6 after a decrease the week before, according to the most recent data from the American Iron and Steel Institute (AISI).