Steel hits a higher note in the US

Steel output in the United States, which has had a wobbly start in early 2023, experienced a 1.2 percent boost in the week ending Feb. 25, according to data gathered by the Washington-based American Iron and Steel Institute (AISI).

AISI says domestic raw steel production of 1.674 million tons in the most recently completed week is up 1.2 percent compared with the 1.654 million tons made the week before. However, the most recent weekly figure is down 4.6 percent from the comparable week in 2022.

Year to date, 13.1 million tons of steel have been made in the U.S. at an average capability utilization (mill capacity) rate of 73.2 percent. That is down 6.1 percent from the more than 13.95 million tons made in the same time frame in 2022, when the capability utilization rate averaged 80.3 percent.

Scrap processors likely will welcome any trend toward increased domestic output. Should U.S. mills become busier at the same time Turkish mills are expected to increase their global scrap purchases as they engage in rebuilding, it could put upward price pressure on ferrous scrap.

Processors in the U.S. have struggled with diminished volumes so far this year, so a price boost at the scale house could help entice more scrap into their yards.

As of Feb. 27, metals information and pricing service Davis Index reports Turkish mills are offering more than $456 per metric ton for heavy melting scrap (HMS) sent from the U.S. That represents a nearly 10 percent boost from the approximately $415 per metric ton being offered in mid-February.

The most recent figure Davis Index has for Chicago area mills paying for HMS is $353 per gross ton as of Feb. 7. That represents a 27 percent boost from the $278 per ton being paid as of Dec. 9, 2022, two months earlier.

Steel producers could see that change is coming in the metallics market. Cleveland-Cliffs announced Monday it will be increasing the “spot market base prices for all carbon hot-rolled, cold-rolled and coated steel products by a minimum of $100 per net ton, effective immediately.” The company also had announced a $100 per ton increase on the same products just six days earlier.