Source: Scrap Monster
The notoriously cyclical steel industry can be a tough business, prone to wild fluctuations.
Last August, U.S. Steel CEO David Burritt, Indiana Gov. Eric Holcomb and other dignitaries gathered to announce $750 million in investments at the Gary Works steel mill.
After steel prices plunged, input costs rose and market conditions deteriorated, U.S. Steel announced just a year later it would idle East Chicago Tin, as well as blast furnaces in Europe, at Great Lakes Works in Detroit and at Gary Works.
The Pittsburgh-based steelmaker, one of the largest employers along the Region's highly industrialized lakeshore, has idled Blast Furnace #8 at Gary Works, the nation's largest steel mill with an annual production capacity of 7.5 million tons.
At Gary Works, U.S. Steel operates three other blast furnaces, the massive super-heated metallurgical furnaces that transform coke, iron ore and limestone into the pig iron that's then forged into steel. Blast Furnace #8 is the smallest at the mill, with a production capacity of 3,300 tons of pig iron per day, according to the American Institute for Steel Technology.
The blast furnace was last relined during 2013, when the hearth walls were replaced for the first time since 1995. The furnace was also idled in 2014 when it suffered an unplanned outage.
U.S. Steel plans to lay off up to 200 workers after idling the Great Lakes B2 blast furnace near Detroit, but spokeswoman Meagan Cox said no layoffs were expected at the much larger Gary Works. Displaced workers will just move to other parts of the sprawling steel mill that extends over seven miles of the Lake Michigan shoreline.
Not all East Chicago Tin workers will be so lucky. About half of the 297 tin mill workers will be offered transfers to U.S. Steel's other two tin mills — both in Northwest Indiana — at Gary Works and the Midwest Plant in Portage.
U.S Steel said the other half will be laid off for the foreseeable future.
Cox said the idlings and layoffs were intended to be temporary and the company would monitor market conditions to see when they would improve. U.S. Steel has no timeline for if and when it might bring the steelmaking facilities in Northwest Indiana back into operation, and when it might recall the laid-off workers.
Despite the idlings at a time when the nation's steelmaking utilization capacity has been hovering around 80%, U.S. Steel will continue to move forward with its five-year $750 million "asset revitalization" investment at Gary Works. The sweeping initiative includes hundreds of projects aimed at improving critical assets like the mill's four blast furnaces, the steel shop, the casters and the hot strip mill.
"This does not affect our ongoing investment at Gary Works," Cox said.