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Shrinking Steel Demand, Indiana Steelmakers Struggle

Thursday, April 9, 2020 11:09 AM EDT Updated: Thursday, April 9, 2020 01:34 PM EDT
By Wes Mills
Shrinking Steel Demand, Indiana Steelmakers Struggle ArcelorMittal steel in East Chicago. (photo courtesy: The Times of Northwest Indiana)

Northwest Indiana’s steel industry continues to feel the effects of the COVID-19 pandemic as demand for the milled product continues to wane.

Our partners at The Times of Northwest Indiana report ArcelorMittal notified the United Steelworkers union that it plans to lay off employees at its Indiana Harbor steel mill in East Chicago.

The publication says the steelmaker is idling the #3 and #4 blast furnaces at that facility. ArcelorMittal employs about 10,000 people in the region.

The company also announced it will shut down a blast furnace in Cleveland, Ohio, leaving just for operating blast furnaces in the U.S.

The outbreak has forced automakers to shutdown production thereby impacting steel demand.

Two weeks ago, Pittsburgh-based United States Steel Corp. (NYSE: X) announced it was starting early on a planned 48-day shutdown of its #4 blast furnace at Gary Works for maintenance. Now, the company says the furnace will remain idled until market conditions improve.

The company also said it has decided to hold off on planned upgrades of its Gary Hot Strip Mill investments.

“The actions we are announcing…make us stronger and enable us to weather the current situation to emerge as a leader in sustainable steel solutions for generations to come,” said U.S. Steel President and Chief Executive Officer David Burritt.

Five national steel trade associations last week sent a letter to congressional leaders, urging them to include significant infrastructure investment in the next phase of COVID-19 stimulus legislation to help with the nation’s economic recovery.

“Social distancing and shelter-in-place measures undoubtedly save lives but continue to slow economic activity in the manufacturing and construction sectors,” the group said in a letter to House Speaker Nancy Pelosi, House Republican Leader Kevin McCarthy, Senate Majority Leader Mitch McConnell and Senate Democratic Leader Charles Schumer.

The letter, written by the American Institute of Steel Construction, American Iron and Steel Institute, Steel Manufacturers Association, The Committee on Pipe and Tube Imports, and Specialty Steel Industry of North America said 38% of America’s 616,000 bridges need to be repaired or replaced.

“Making a long-term and robust infrastructure investment now will not only respond to the urgent transportation system needs that are well known, but it also will create high paying jobs allowing businesses and families to recover from this extremely difficult economic shock,” said the group.

The trade groups said infrastructure provisions in a federal stimulus package would improve quality of life in our cities, towns and rural areas and drive commerce and supplies across the nation.

Story Continues Below

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