US Steel turns to DRI and pig iron for EAFs

United States Steel Corp. has announced two projects it says will “expand its low-cost iron ore competitive advantage and increase its self-sufficiency by supplying domestic feedstock” to its electric arc furnace (EAF) steel mills.

U.S. Steel, based in Pittsburgh, owns the Big River EAF mill in Arkansas and is in the process of adding 3 million tons per year of capacity there.

A press release issued by the company in late June does not mention ferrous scrap as a raw material by name. However, the company says the new investment and partnership just announced will contribute double-digit percentages of ore-based feedstock to several melt shops.

To supply its EAF mills, U.S. Steel says it break ground this fall 2022 at one of its two Minnesota Ore facilities, Keetac or Minntac, to construct a system to produce pellets that can be converted to direct-reduced iron (DRI) or hot-briquetted iron (HBI). The company refers to the predecessor material as DR-grade pellets.

U.S. Steel says the $150 million project will enable one of the company’s existing pelletizing plants to “not only create DR-grade pellets” for its EAF melt shops but also “maintain the optionality to continue producing blast furnace-grade pellets.”

The company adds that it will have the option to sell the new pellets to third-party DRI and HBI producers or use them to feed a potential future DRI or HBI facility of its own. The DR-grade pellets produced would be a new product line for U.S. Steel.

To feed its blast furnace/basic oxygen furnace (BOF) mills, U.S. Steel is making a second move to tap into North American iron ore to create feedstock. The company says it has signed a nonbinding letter of intent with Illinois-based SunCoke Energy Inc. to sell that firm two blast furnaces in Granite City, Illinois.

Per the agreement, SunCoke would then build a 2-million-ton-per-year granulated pig iron production facility. Via that project, SunCoke would supply U.S. Steel access to 100 percent of the pig iron produced there for the next 10 years.

“U.S. Steel intends to supply the needed iron ore to be used to produce the pig iron,” the company says. Because the ore would come from U.S. Steel’s own mines, the steelmaker says it would “realize a significant cost advantage.” The resulting pig iron also could be used by EAFs “and is expected to supply U.S. Steel’s growing fleet of EAFs."

“This project significantly enhances SunCoke’s current footprint, allowing us to become a diversified supplier of coke and metallics to the steel industry,” says Mike Rippey, president and CEO of SunCoke. “It also demonstrates our long-term customer’s confidence in SunCoke’s operational and technical expertise.”

“Our conviction remains that steel mined, melted and made in America is vital to our national and economic security,” says David B. Burritt, president and CEO of U.S. Steel. “We are strategically investing in our raw materials that will feed the advanced steel mills of today and tomorrow, making us increasingly self-sufficient.”

U.S. Steel says the two projects join another investment in a pig iron caster at its Gary Works in Indiana. That $60 million investment will produce up to 500,000 tons of pig iron annually and is expected to provide nearly 50 percent of Big River Steel’s ore-based metallics needs, according to the firm.