U.S. Steel Capacity Utilization Rate Up Over 3 Percentage Points Through Oct. 20
Although not yet at the coveted 80% mark, the U.S. steel sector’s capacity utilization rate is up over three percentage points in the year to date (up to Oct. 20) compared with the same time frame in 2017.
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Through Oct. 20, domestic raw steel production hit 76,076,000 tons, good for a capacity utilization rate of 77.7%, according to the American Iron and Steel Institute (AISI). Production during the same time frame in 2017 was 72,542,000 tons at a capacity utilization rate of 74.3%.
For the week ending Oct. 20, however, the capacity utilization rate hit 80.0%, during which 1,875,000 tons were produced. Production during that week was up 10.0% from the same week last year, when production hit 1,705,000 tons. Production for the week ending Oct. 20 was down from the previous week, however, by 0.3%.
According to AISI, production by region amounted to: North East: 222,000; Great Lakes: 685,000; Midwest: 197,000; Southern: 687,000, and Western: 84,000.
Prior to the imposition of tariffs on imports of steel and aluminum amounting to 25% and 10%, respectively, the U.S. Department of Commerce explained that proposed remedies vis-a-vis imports of the metals aimed to bring the U.S. capacity utilization rate for each metal up to 80%.
Secretary of Commerce Wilbur Ross’ report to President Trump — required by Section 232 of the Trade Expansion Act of 1962 — identified the 80% benchmark as a goal for both the domestic steel and aluminum sectors.
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“Each of these remedies is intended to increase domestic steel production from its present 73% of capacity to approximately an 80% operating rate, the minimum rate needed for the long-term viability of the industry,” a Department of Commerce release in February stated. “Each remedy applies measures to all countries and all steel products to prevent circumvention.”
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