The new year represents an opportunity to capitalize on America’s leadership position in free market principles, steel industry modernization, and global efforts to create a lower carbon future for the steel industry. Steel Manufacturing Association (SMA) members are poised to lead the way.
International trade will continue to dominate the conversation around steel. The White House recently announced the extension of the EU’s steel tariff-rate quotas (TRQs) until Dec. 31, 2025, paving the way to avoid EU retaliatory tariffs on American manufactured products. The move gives the United States and the EU time to work out a long-term trade deal that reflects our commitment to emissions reduction, while protecting American and European workers against unfair trade practices and the proliferation of non-market excess steel capacity.
The US International Trade Commission (ITC) has begun a fact-finding investigation on greenhouse-gas emissions in steelmaking at the request of US Trade Representative Katherine Tai. SMA testified at the commission hearing in December and fully supports the ITC investigation. This effort would enable any future trade deal to consider the carbon intensity of more than 50 categories of steel products and allow for more accurate global comparisons. The commission will gather the data and submit a report to the USTR by January 2025.
SMA members continue to lead the way with investments in clean steelmaking technologies. Nucor has broken ground on new low-emissions mills in Mason County, W.Va.—the single biggest investment by a company in the state’s history — and Lexington, N.C., among other projects. CMC continues making progress on a forthcoming EAF mill in West Virginia and melt shop expansions in Arizona. Steel Dynamics Inc. (SDI), whose steel customers are significant consumers and processors of aluminum flat-rolled products, continues a growth strategy aligned with its core steelmaking and recycling platforms.
SDI is constructing an aluminum mill in Columbus, Miss., demonstrating the synergies that can exist in this steel-adjacent space. U.S. Steel’s Big River Steel will soon commission another 3 million tons of capacity in Arkansas. And the list goes on. Between 2021 and 2025, SMA member companies will have invested over $18 billion of their own capital in new capacity that will result in the modernization, electrification, and decarbonization of the metals industry.
Steelmakers in other countries have not matched that level of private investment, but other nations are nevertheless taking steps to make their steel industries look more like ours. With billions in government subsidies, steelmakers around the world are replacing integrated furnaces with lower-emission electric-arc furnaces.
In 2023, the Global Steel Climate Council (GSCC) unveiled the Steel Climate Standard. It has changed the conversation about green steel by showing the wisdom of a single carbon-intensity standard for all steel products, no matter how or where they are made. It makes no special accommodations for integrated steelmaking. It also requires all steelmakers to get cleaner than they are today. The GSCC’s new executive director, Adina Renee Adler, brings a wealth of experience in international trade, public policy, and metals recycling to her new role.
Our domestic steel industry led by members of the SMA has transcended every type of economic, political, and technological challenge it has faced. At our core we are committed to safely and sustainably building better lives, companies, communities, and environments.
Philip BellRead more from Philip Bell
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We’ve all heard a lot about mill “discipline” following a wave of consolidation over the last few years. That discipline is often evident when prices are rising, less so when they are falling. I remember hearing earlier this year that mills weren’t going to let hot-rolled (HR) coil prices fall below $1,000 per short ton (st). Then not below $900/st. Now, some of you tell me that HR prices in the mid/high-$800s are the “1-800 price” – widely available to regular spot buyers. So what comes next, and will mills “hold the line” in the $800s?
Everyone knows the old saying that “a picture is worth a thousand words.” Just because it’s a cliché doesn’t mean that it’s wrong. A lot of inked has been spilled trying to figure out why prices are falling now. I thought it might be as simple as this: Market dynamics in the fourth quarter (UAW strike, companies buying ahead of an anticipated post-strike price spike, etc.) pulled forward restocking activity that typically happens in the first quarter.