Analysis
November 11, 2025
Final Thoughts
Written by Stephen Miller
The electric-arc furnace (EAF) is considered a new technology by many people in the steel and scrap trade. As the US continues its transition away from traditional steelmaking methods to the EAF method, few realize the EAF is actually much older than it appears.
The EAF has its roots in the 19th century. Its concept and experimentation dates back to the early 1800s when Sir Humphrey Davy did an experimental demonstration. Then in 1878 William Siemens patented electric furnaces of the arc type. The first commercial EAF was established in 1907 in Syracuse, N.Y. This furnace is currently on display at Station Square in Pittsburgh.
During this initial period, the EAF was used to make specialty steels such as machine tools and spring steels. The high cost of electricity at that time prevented expansion into the steel manufacturing mainstream.
However, as WWII approached, the EAF got called into service. The installation and operation of an EAF steelmaking could be accomplished much faster than an integrated operation and time was of the essence. In Europe, EAFs were built for the war effort. In the US, there was also a need for rapid expansion.
On the eve of World War II, Copperweld Steel installed two 35-ton EAFs in 1939 at their plant in Warren, Ohio. This EAF mill produced steel bar to be used to make wartime equipment and ordinance. This furnace relied of ferrous scrap, which was becoming more available than in previous periods.
After WWII, economic activity increased dramatically. The US steel industry was beginning to make the transition from the Open Hearth Furnace to the Basic Oxygen Furnace (BOF) to convert iron from the blast furnace into steel. The Open Hearth method used a great deal of scrap in its process. The newer BOF route used minimal scrap. Since the integrated steelmakers dominated the US market during this period, ferrous scrap prices fell sharply and the material became quite abundant.
This situation allowed the use of EAF steelmaking to thrive. The economics made sense. Long product and bar producers moved to the EAF method, taking advantage of reasonably priced scrap and lower capital and operating costs. This culminated with the rise of the mini-mills headed by Charlotte, N.C.-based Nucor Corp. Other steelmakers soon followed suit.
These new mini-mills were able to compete with the integrated mills in certain segments of the market. However, “Big Steel” still had the advantage in the flat-roll sector. The mini-mills could not produce deep drawing quality sheet for the automakers using scrap that contained residual alloys. This was about to change.
In the early 1990s, new technology emerged that changed the products mini-mills could produce. This new thin slab casting method made possible the production of hot-rolled coils (HRC) using scrap. This method still required the use of a significant amount of virgin iron units to neutralize the tramp alloys found in obsolescent scrap.
The best virgin iron unit was pig iron. However, the same situation that gave rise to EAF proliferation, namely less expensive scrap, had wiped out the domestic pig iron industry in the US. Foundries and smaller steel mills moved away from using pig iron, preferring to use cheaper scrap. Still, pig iron ingots were available for importation from countries like Brazil and later Ukraine and Russia.
Pig iron imports soared to levels exceeding 6 million metric tons per year as new EAF mills came on-line. Around the same time, direct-reduced Iron (DRI) production was growing in the Western Hemisphere, and this material was also used by EAFs to control scrap impurities. Needless to say, all this was a major tide change for the steel industry.
Most of us know the story from there. Today the US produces about 70% of its steel using the EAF method. The irony of it was, what was considered an advancement of steelmaking technology had the unintended consequence of leading to the partial demise of that method. Another irony was the change had nothing to do with concerns about climate change or going green. It was simply economically and technologically driven. But what a bonus!
