American steel sector starts year with upward momentum

Steel mills in the United States produced more steel in the week ending Jan. 6 than they did the prior week or the comparable week in 2023, according to the Washington-based American Iron and Steel Institute (AISI).

Domestic raw steel production was 1.707 million tons in the first week of this year, which represents a 1.6 percent increase from the 1.68 million tons made in the comparable week in the previous year.

That 1.707 million total also was 1.6 percent higher than output the prior week, when mills in the U.S. also made 1.68 million tons of steel.

In the week ending Jan. 6, the U.S. mill capability utilization (capacity) rate was 76.9 percent. That is higher than the 75.2 percent rate from one year ago and the 73.1 percent capacity rate in the prior week (the final week of 2023).

Broken down by the AISI’s five geographic districts, output the week ending Jan. 6 was as follows:

• Southern, 771,000 tons;
• Great Lakes, 557,000 tons;
• Midwest, 190,000 tons;
• North East, 125,000 tons; and
• Western, 64,000 tons.

A healthy domestic steel sector would seem to bode well for the price of ferrous scrap in the U.S., but pricing and metals news services are reporting that domestic mills are attempting to secure scrap at a lower price this January.

The London-based Kallanish Commodities steel news service is reporting American mills making bids from $20 to $50 per ton lower (depending on the grade) for ferrous scrap in the Great Lakes region in early January.

Davis Index is reporting news from Turkey that could bring a little more cheer to the U.S. ferrous scrap market. According to that news and pricing service, mills in Turkey are offering about $5 more per ton for ferrous scrap in the second week of January compared with the prior week.

Reporting on Turkish orders placed in Europe, the United Kingdom and the U.S., Davis Index writes Jan. 8, “Demand for imported ferrous cargoes for February shipment is strong in Turkey today.”

While a weak export market can suppress prices for obsolete grades, particularly along the Atlantic seaboard of the U.S., an active Turkish market can have the opposite effect.