Posted on 10 Feb 2022
US flat-rolled steelmakers have invested heavily over the last few years to diversify the types of steel they produce, consuming more hot rolled coil (HRC) production to make value-added products.
Between 2020 and 2025 US steelmakers will add 8.67mn short tons (st) of cold rolled coil (CRC), hot dipped galvanized (HDG) and painted steel productioncapacity. In the same period electric arc furnace (EAF) steelmakers will increase overall HRC steel production capacity by nearly 13mn st through greenfield and brownfield investments.
Overall US steel production is estimated to be over 94.5mn st in 2021, while shipments were 87mn st in the first 11 months of the year, according to data from the American Iron and Steel Institute (AISI).
These value-add investments are seen as necessary for steelmakers like Nucor that produce steel using lower cost, lower emissions electric arc furnaces (EAFs) to provide more steel to the automotive industry, and to improve penetration and product offerings into the construction industry. The increased consumption of CRC and HDG products will also lessen the amount of commodity-grade HRC available to the US market.
So far, 2.2mn st/yr of new value-added steel production is already in operation in the US and Mexico. Nucor has been the driving force, building 1.4mn st/yr of galvanizing capacity across its Gallatin, Kentucky, and its Hickman, Arkansas, steel mills and at its Nucor-JFE Steel joint venture in Mexico, capacity that went on line between 2020 and 2021. EAF steelmaker Steel Dynamics (SDI) has added 550,000st/yr of galvanized and 250,000st/yr of paint production at its new 3mn st/yr Sinton, Texas, flat-rolled mill. Those lines began production in the second half of 2021.
Nearly 5.28mn st of the new value-add production will be for HDG coil, followed by CRC and paint production.
Nucor and integrated steelmaker US Steel will dedicate large sections of their respective 3mn st/yr flat-rolled mills to value-add production, with Nucor hoping to penetrate deeper into the auto and construction industries and US Steel diversifying its domestic production away from carbon-intensive blast furnaces and towards scrap-consuming EAF production. Nucor expects its mill to be operational by 2025, while US Steel is targeting 2024.
| US value-add investments 2020-2025 | st | ||||
| Galvanized production | Cold rolled production | Paint production | Total tons | Year complete | |
| Built | |||||
| Nucor | |||||
| Gallatin | 500,000 | 2020 | |||
| Nucor-JFE Steel Mexico | 400,000 | 2020 | |||
| Hickman, Arkansas | 500,000 | 2021 | |||
| SDI | |||||
| Sinton, Texas | 550,000 | 250,000 | 2021 | ||
| To be built | |||||
| Nucor | |||||
| Hickman, Arkansas | 250,000 | 2022 | |||
| Crawfordsville, Indiana | 300,000 | 250,000 | 2024 | ||
| Mason County, West Virginia | 1,100,000 | 800,000 | 2024/2025 | ||
| SDI | |||||
| Terre Haute, Indiana | 300,000 | 240,000 | 2022 | ||
| Sinton, Texas | 300,000 | 240,000 | 2022 | ||
| US Steel | |||||
| Arkansas mill | 1,000,000 | 1,200,000 | 165,000 | 2024 | |
| Big River Steel | 325,000 | 2024 | |||
| Total | 5,275,000 | 2,000,000 | 1,395,000 | 8,670,000 | |
| — Company announcements | |||||
Source:Platts
