U.S. raw steel production for the week ending Oct. 3 was 1.484 million net tons, while the capability utilization rate was 66.6 percent, according to the American Iron and Steel Institute (AISI), Washington. That compares with production of 1.8 million net tons for the week ending Oct. 3, 2019, when the capability utilization was 77.7 percent.
Production for the current week represents a 17.7 percent decrease from the same period in the previous year, AISI notes, though it is a 0.3 percent increase from the previous week of this year, ending Sept. 26. During that week, production was 1.48 million net tons at a capability utilization rate of 66.1 percent.
Steel mills in the southern district led production during the week ending Oct. 3, having produced 575,000 tons. The Great Lakes district produced 531,000 tons of raw steel; during that time frame, followed by the Midwest at 168,000, the northeast at 144,000 and western district at 66,000 tons.
AISI notes that capability for the fourth quarter of this year is approximately 29.1 million tons compared with 30.4 million tons for the same period last year and 29.4 million tons for the third quarter of 2020.
Despite the increasing production, Fastmarkets AMM reports that its sources believe the ferrous scrap market will move sideways rather than show signs of strength in October, pointing to good supply at yards and high inventory levels at mills.
The publication quotes a Midwest scrap seller who says, "Everyone was hoping for upward momentum, but there are a lot of big dealers with a lot of big tonnages. Everyone has been run over with scrap offers, mills are long on inventory and there are not enough takers.” That source adds that mid-September deals evaporated, indicating mills had sufficient inventory.
Fastmarkets AMM adds that a number of scrap orders have been booked on a to-be-determined basis by dealers "to prevent a disruption in shipments or because they did not want to find themselves with no order at the end of the trade."