US Monthly Raw Steel Production Eases Through June

Note that AISI’s monthly production estimates are different than the weekly estimates SMU reports each Tuesday. The monthly estimates are based on over 75% of domestic mills reporting versus only 50% reporting weekly estimates.

Figure 1 compares monthly production data on a three-month moving average (3MMA) basis to smooth out month-to-month fluctuations. Raw steel production averaged 7.65 million tons between April and June 2022, down 4% from the same quarter in 2021. The average production rate for Q2 2022 is down 3% versus the previous quarter, down 3% versus Q4 2021, and down 6% from Q3 2021. Recall that Q2 2020 production plunged to the lowest 3MMA level in our 12-year history at 5.39 million tons.

SMU publishes regional steel production data for the four regions responsible for 10% or more of total domestic production. Figure 2 shows 3MMA production history from the combined states of Virginia, West Virginia, Georgia, Florida, North Carolina, South Carolina and Louisiana. The latest 3MMA for June is 885,000 tons, right in the middle of levels seen over the last year, and up 3% compared to the same period in 2021.

Figure 3 shows the combined production in Alabama, Tennessee, Mississippi, Arkansas, and Kentucky. The June 3MMA is 1.98 million tons, up 3% year-over-year. Recall that September 2021 saw the highest 3MMA level in SMU’s recorded history at 2.15 million tons.

Figure 4 displays 3MMA production from Ohio, currently at 872,000 tons through June and down 12% over the same period in 2021. This is the lowest 3MMA since February 2021.

Figure 5 shows the 3MMA production levels from the state of Indiana through June. Production is now at 1.81 million tons, down 14% compared to one year ago. This is the fourth lowest 3MMA seen in the last year and a half.

The average mill capacity utilization rate for June was 79.6%, down from 81.1% in May and down from 83.0% one year ago. The average capacity utilization rate for the year is now 80.3%, up from 79.4% in the first six months of 2021.

On a 3MMA basis, the capacity utilization rate through June reached a five-month high of 80.9%, down 1% compared to the same period one year prior. As shown in Figure 6, the 3MMA utilization rate had increased each month from the June 2020 low through September 2021.

SMU Note: Additional raw steel production graphics are available in the Analysis section of our website here. If you need assistance logging into or navigating the website, contact us at info@SteelMarketUpdate.com.

By Brett Linton, Brett@SteelMarketUpdate.com