U.S. And EU Producers Curb Steel Production As Prices Flatline

The Raw Steels Monthly Metals Index (MMI) fell by 3.04% from September to October. U.S. steel prices continued to drop throughout September. However, declines for both hot rolled coil prices and cold rolled coil prices slowed to a sideways trend. Plate prices, which have shown the most strength of steel prices, traded down for the second consecutive month. They now sit at their lowest level since September 2021.

U.S. Steel Idles Two Furnaces as Steel Prices Slide

As steel prices continue their slow descent, one steelmaker appears eager to cut capacity. In early September, U.S. Steel idled its 1.5 million short ton per year blast furnace with no scheduled restart date. The company attributed the decision to “high import levels and market conditions.” Most likely, this was a reference to the steep price declines among steel commodities since October 2021.

More recently, U.S. Steel announced the indefinite idling of its 1.4 million-short-ton-per-year Mon Valley blast furnace. The furnace was previously taken offline on September 3 for maintenance. Although the company initially planned to return it to production after 30 days, they later announced it would remain idle. According to a company statement, management wished to “balance our production with our order book.”

The steelmaker’s latest decisions suggest that the domestic markets continue to grapple with oversupply despite the loss of competitively priced European imports. Amid many compounding economic pressures, demand has begun to show signs of easing. Meanwhile, ongoing ramp-ups from new and expanded mills continue to inflate domestic capacity.