The recent round of Q1 earnings calls for US refiners and upstream producers were almost unanimously...

Entergy's 845-MW Palisades plant in Covert, Michigan, shut permanently May 20, more than a week...

Spot natural gas prices across the desert southwest could be in for an early summer rally in late...

US Steel to build pig iron capacity at Indiana steel operations

Platts Steel Raw Materials Monthly

Entergy's Palisades nuclear plant in Michigan shuts permanently

For steel sector, China’s decarbonization is a costly quest

500,000 mt/year pig iron capacity will supply EAF

Company still looking at DRI opportunities

US Steel is finalizing an agreement with an unnamed strategic partner to build 500,000 mt/year of pig iron capacity at its Gary Works integrated steel operations in Indiana by 2023, CEO David Burritt said Oct. 29.

Receive daily email alerts, subscriber notes & personalize your experience.

"Under the contemplated deal, our potential partner would fund, install and operate pig iron production assets, which we would supply with excess liquid iron production," Burritt said during a call with analysts. "This is an efficient and quick way to expand our iron ore advantage to our mini mills, and we continue to evaluate other opportunities to extract additional value from iron ore."

Burritt said the pig iron output would supply US Steel's Big River Steel electric arc furnace in Arkansas and drive "blast furnace efficiencies at Gary Works."

Richard Fruehauf, US Steel's Chief Strategy & Sustainability Officer, said the new pig iron capacity will be able to supply Big River with nearly 50% of its ore-based metallics needs and eventually support supply to the company's proposed second EAF mini-mill.

However, the pig iron capacity is viewed as an "interim solution" for the steelmaker's growing EAF footprint as it eyes future direct-reduced iron production opportunities in the US to meet its sustainability goals by 2050, Fruehauf added.

The proposed pig iron joint venture in Indiana will process iron ore from US Steel's mining operations in Minnesota.

The Pittsburgh-based company reported a net income of $2 billion on net sales of $5.96 billion in Q3, up from a net loss of $234 million on sales of $2.34 billion in the same quarter last year.

Coating line at Big River

Burritt said US Steel will also add a 325,000 st/year steel coating line at Big River that will produce galvalume and galvanized products.

"Galvalume capabilities create opportunities to target the higher value construction market, including exposed building panels, and hot galvanizing capabilities create additional opportunities to serve the appliance, automotive and construction markets," he said. "The investments we are making at Big River are natural extensions of the Big River campus and further utilize the state-of-the-art capabilities of the facility as we provide customers with sustainable steels to help meet their own decarbonization objectives."

New EAF to not raise capacity

Construction of US Steel's second EAF mill is scheduled to begin as early as the first half of 2021, but it is not expected to add to the company's overall US production volumes, Burritt said.

Burritt was asked by analysts if the new mill's production is viewed as a replacement to US Steel's already-curtailed blast furnace capacity, or if additional BF capacity will come offline in the near future to accommodate the new EAF volume. He said only that there were no plans to reinstate idled BF capacity.

"We're informed by what our customers want, and if our customers want the additional capacity at Great Lakes [Michigan steelmaking facility] and they're willing to pay for that capacity, we're happy to open that up and have them pay to decarbonize it," Burritt said.

"It does not look like that will happen, so that's been idled indefinitely. The same thing at Granite City [Illinois] works, but the thing that we need to remember here is we are not building capacity."

US Steel has not yet finalized a location for the new mini-mill, but permits for potential construction have been filed in multiple states, he added.

To continue reading you must login or register with us.

It’s free and easy to do. Please use the button below and we will bring you back here when complete.