The United States has developed a steel industry that sets a high standard for the rest of the world to reach in terms of sustainability and meeting Paris Climate Accord targets, according to an executive of Charlotte, North Carolina-based Nucor Corp.
The positive assessment was offered by Benjamin Pickett, a Nucor general manager of public affairs and government relations, speaking at the Ferrous Spotlight session of the ISRI2021 virtual event organized by the Washington-based Institute of Scrap Recycling Industries (ISRI).
Pickett said of Nucor and America’s metal recycling companies, “We were all recycling before it was cool to be green.”
In an era of decarbonization and global emissions reduction targets, Pickett said the scrap-fed electric arc furnace (EAF) production method is “the cleanest way to make steel, and America is the cleanest place on Earth to make steel—period.”
The Nucor GM said more than two-thirds of the steel produced in the U.S. is made via the EAF method, with Nucor having played a major role in that development. The company has the capacity to make some 27 million tons of EAF steel annually and has invested some $4.2 billion in the past three years to add to that total.
Pickett said Nucor invests “not just to add capacity, but to add capability. The days of EAFs making just rebar are long gone.” Now, Pickett said, some 35 grades of steel are made via EAF in the U.S., with a “diverse range of strengths and applications.”
He added, “Recycled steel is a solution—scrap-based EAFs are proof that economic growth, infrastructure and our nation’s climate goals can co-exist.”
In comments similar to those made a week earlier by Lourenco Goncalves of steelmaker Cleveland-Cliffs at a FastmarketsAMM event, Pickett compared a steel industry greenhouse gas (GHG) emissions intensity level of around 1 in the U.S. that was less than half that compared with the steel industry in China. Nucor, he added, was emitting GHGs at half of the U.S. average.
Nucor and the steel industry in the U.S. “have a great story to tell, and we are sharing that with our policymakers in [Washington] D.C. and the states, and I certainly hope our ISRI members will do the same,” remarked Pickett.
Pickett also said trade enforcement actions undertaken by the U.S. government have helped the steel industry and recyclers. Such enforcement, he said, “helps ensure our steel and recycling markets have a level playing field.” Pickett said some countries, including China, have an “addiction” to dumping steel, but that Section 232 tariffs “helped the U.S to keep investing in much cleaner steelmaking technology.”
In a separate presentation, Blake Hurtik of Argus Media said pricing from the second half of 2020 and into 2021 seems to indicate steelmakers are potentially being helped a little more than recyclers.
Hurtik said the current $1,300 per ton pricing for hot-rolled coil (HRC) steel compared with the $400 to $500 per ton for ferrous scrap grades has created an $800 spread that is rarely if ever experienced by EAF steelmakers. The result, he noted, is EAF steelmakers like Nucor and Indiana-based Steel Dynamics Inc. predicting record or near-record profits for the first quarter of 2021.
Despite rebounding demand and high prices, steelmakers in the U.S. have kept the mill capacity rate hovering around 78 percent, Hurtik noted. A more consolidated industry that is “not just turning on supply to turn on supply” seems to have demonstrated concerted discipline, he added.
Both speakers see a boom market that is poised to continue, with Hurtik saying some 11 million tons of in-progress additional EAF capacity is “very much a positive for scrap demand.” He added, “Even if the U.S. never sells a ton [of scrap] directly to China,” such purchases by China’s growing EAF sector “will open up a hole somewhere else” for scrap sold off the U.S. West Coast.
Pickett expressed Nucor’s support for a bipartisan infrastructure plan that can be worked out between the Biden administration and Congress. “We believe the recycling industry will be key to what President Biden calls ‘building back better,’” he stated. “The story needs to be told—recycled steel is being used throughout America in critical infrastructure.”