90


### IRON AND STEEL1

(Data in million metric tons of metal, unless otherwise noted)

Domestic Production and Use:The iron and steel industry and ferrous foundries produced goods valued at about $73 billion. The steel industry consisted of 101 companies that produced raw steel at 143 locations, with combined raw steel production capability of about 126 million tons. Indiana accounted for about 21% of total raw steel production, followed by Ohio, 16%, and Pennsylvania, 8%. Pig iron was produced by 14 companies operating integrated steel mills, with about 39 blast furnaces in continuous operation. Integrated companies accounted for about 57% of total steel production, including output of their electric arc furnaces. The distribution of steel shipments was estimated as follows: warehouses and steel service centers, 21%; transportation (predominantly for automotive production), 13%; construction, 14%; cans and containers, 4%; and others, 48%. Ferrous foundries, numbering about 1,100, continued to be importers of pig iron into the United States, mainly from Brazil and Russia.

Salient Statistics—United States: 1994 1995 1996 1997 1998 1 e Pig iron production 49.4 50.9 49.4 49.6 50.1 2 Steel production: 91.2 95.2 95.5 98.5 102 Basic oxygen furnaces, percent 60.7 59.6 57.4 56.2 55.3 Electric arc furnaces, percent 39.3 40.4 42.6 43.8 44.9 Continuously cast steel, percent 89.5 91.0 93.2 94.7 95.3 Shipments: Steel mill products 86.3 88.4 91.5 96.0 97.8 Steel castings 1.0 1.1 1.2 1.2 1.2 3 Iron castings 13.2 9.8 9.8 9.8 9.8

3 Imports of steel mill products 27.3 22.1 26.5 28.3 34.6 Exports of steel mill products 3.5 6.4 4.6 5.5 4.7 Apparent steel consumption 104 102 108 114 113 4 Producer price index for steel mill products (1982=100) 113.4 120.1 115.6 116.4 114

5 Steel mill product stocks at service centers yearend 6.6 5.9 6.3 6.6 7.3

6 Total employment, average, number 7 Blast furnaces and steel mills 172,000 171,000 168,000 169,000 168,000 Iron and steel foundries 125,000 130,000 129,000 128,000 127,000 Net import reliance as a percent of 8 apparent consumption 22 21 20 20 18

Recycling :See Iron and Steel Scrap and Iron and Steel Slag.

Import Sources (1994-97):European Union, 27%; Canada, 16%; Japan, 9%; Brazil, 9%; and other, 39%.

Tariff: Item Number Normal Trade

9 Relations (NTR) Canada Mexico Non-NTR 10 11 12/31/98 12/31/98 12/31/98 12/31/98

Pig iron 7201.10.0000 Free Free Free $1.11/t. Carbon steel: Semifinished 7207.12.0050 2.5% Free 2.1% 20%. Structural shapes 7216.33.0090 0.5% Free 0.4% 2%. Bars, hot-rolled 7213.20.0000 1.1% Free 0.9% 5.5%. Sheets, hot-rolled 7208.39.0030 2.9% Free 2.4% 20%. Hot-rolled, pickled 7208.27.0060 3.1% Free 2.5% 0.4¢/kg+20%. Cold-rolled 7209.18.2550 1.9% Free 1.6% 20%. Galvanized 7210.49.0090 3.9% Free 3.2% 21.5%. Stainless steel: Semifinished 7218.91.0015 3.1% Free 2.6% 29%. 7218.99.0015 3.1% Free 2.6% 29%. Bars, cold-finished 7222.20.0075 6.4% Free 5.3% 29%. Pipe and tube 7304.41.3045 4.6% Free Free 36%. Cold-rolled sheets 7219.33.0035 6.1% Free 5.0% 29%.

Prepared by Michael Fenton [(703) 648-4972, mfenton@usgs.gov, fax: (703) 648-7757]91


### IRON AND STEEL

Depletion Allowance: Not applicable.

Government Stockpile:None.

Events, Trends, and Issues:Pig iron production and steel production and shipments continued to increase during 1998. The basic oxygen process used in integrated mills continued to decline in importance relative to the use of electric arc furnaces and continuous casting in minimills. Capital expenditures by integrated steelmakers was an estimated $2.2 billion in 1998, an increase of nearly 5% from that of 1997. Capital expenditures in minimills also increased to $1.4 billion, 16% more than that of 1997.

Although domestic demand for steel remained high during 1998 and domestic steelmaking capacity increased, pessimism in the industry grew as steel spot prices and exports declined while imports increased. July imports of relatively low-priced steel were 44% greater than imports during July 1997. Some minimalist and integrated mills responded by cutting production. Capacity utilization decreased below 80%. Some mills also reduced scrap inventories and laid off workers. Several big producers joined the United Steel Workers of America to file antidumping suits against Japanese, Russian, and Brazilian hot roll producers.

The United Steelworkers of America and the Made in the USA Foundation filed a lawsuit against the Federal Government charging that the North American Free Trade Agreement (NAFTA) is unconstitutional on the ground that it is a treaty that was not approved by two-thirds vote of the Senate. The Department of Labor determined that about 7,400 steelworker union members have been displaced as a result of NAFTA.

World Production : Pig iron Raw steel 1997 1998 1997 1998 e e

United States 49.6 50.1 98.5 102 Brazil 25.0 25.6 25.1 25.8 China 115 115 108 111 European Union 96.4 102 165 170 Japan 78.5 75.0 105 95.1 Korea, Republic of 22.7 23.5 42.6 41.1 Russia 37.3 35.4 48.4 42.8 Ukraine 20.0 21.6 25.6 24.8 Other countries 105 95.8 177 170 World total (may be rounded) 550 544 795 783

World Resources :Not applicable. See Iron Ore.

Substitutes :Iron is the least expensive and most widely used metal. In most applications, iron and steel compete either with less expensive nonmetallic materials or with more expensive materials having a property advantage. Iron and steel compete with lighter materials, such as aluminum and plastics, in the motor vehicle industry; aluminum, concrete, and wood in construction; and aluminum, glass, paper, and plastics in containers.

Estimated. eProduction and shipments data source is the American Iron and Steel Institute (AISI); see also Iron Ore and Iron and Steel Scrap. 1 More than 95% of iron made is transported molten to steelmaking furnaces located at the same site. 2U.S. Department of Commerce, Bureau of the Census. 3Defined as steel shipments + imports - exports + adjustments for industry stock changes + adjustment for imports of semifinished steel products. 4
Bureau of Labor Statistics. 5Steel Service Center Institute. 6Bureau of Labor Statistics. Blast furnaces and steel mills: SIC 3312; Iron and steel foundries: SIC 3320. 7Defined as imports - exports + adjustments for Government and industry stock changes. 8All tariff percentages are ad valorem. 9
No tariff for Israel and certain Caribbean and Andean nations. 10See Appendix B. 11
U.S. Geological Survey, Mineral Commodity Summaries, January 1999