The US Steel industry has more than 100 steel making and production facilities under them which give rise to 98 million tons in steel shipments valued at $75 billion in 2014.
Definition / Scope
The Foundation of this report
- By 1900, USA was the largest steel manufacturer with low cost production, and the demand was steel was growing continuously. Their production had tripled since 1890, but the customers were gaining profits, not the manufacturers.
- But, during the recession, the demand fell deeply, erasing any sign of profit, output and prices. But then Mr. Charles M. Schwab and Mr. Carnegie Steel proposed a solution: consolidation. Investor Mr. J. P. Morgan arranged the buyout of Carnegie and most major forms, and he put Mr. Elbert Gary in-charge.
- US Steel combined the “American Tin Plate”, “American Steel and Wire” and “Nation Tube” with major integrated companies, which were “Carnegie Steel” and “Federal Steel”. It was capitalized at $1.466 billion, and consisted of 213 mills, 1000 miles of railroad and 41 mines.
- In 1991, the combination of firms accounted for 66% of America’s steel output, and an approximate 30% of the world’s.
- The US Steel industry has more than 100 steel making and production facilities under them which give rise to 98 million tons in steel shipments valued at $75 billion in 2014.
- The steel industry directly employs about 1,50,000 people in the United States, and it directly/indirectly supports more than 1 million US jobs.
- Labor productivity has increased 5 times since the early 1980s, when the average steel mill produced one ton of steel for 10.1 worker hours. And in 2014, the average declined to 1.9 worker hours/ton. And this is not it! Many mills have an average of less than an hour per ton of steel produced.
- According to US EPA’s Sector Performance Report, the steel industry has the seen a deepest decline in the air pollution emission, amongst the nine manufacturing sectors taken under study.
- Since 1990, the industry has reduced its energy intensity by 32% and CO2 emissions by 37% per ton of steel.
- The North American steel industry has the safest working environment and follows high hygiene standards
Bygone times of Steel
The history of steel began in the late 1850s, but since then, the steel was of basic quality for the world’s industrial economy. The bulk production of steel started with the Henry Bessemer’s ‘Bessemer Converter’ in 1857. Earlier steel was very expensive to produce and was used only in small but premium items such as ‘knives’, ‘swords’ and ‘armour’.
Drifts of the 19th century
- There was an exponential growth of pig iron. Britain just went from 1.3 million tons in 1840 to 6.7 million in 1870 and 10.4 million in 1913. The US started from a lower base, but they too grew at faster pace, from 0.32 million tons in 1840 to 1.7 million in 1870 and a whopping 31.5 million in 1913.
- As far as Germany was concerned, they went from 0.19 million tons in 1859 to 1.56 million in 1871 and 19.3 in 1913. France, Belgium and Austria-Hungary together went from 2.2 million tons in 1870 to 14.1 million in 1913, on the evening of World War.
- During the war, the demand for ammunition and other supplies rose drastically, which resulted into sudden growth in output of steel and diversion to military uses.
Top Market Opportunities
- “US Steel” consists of multiple domestic and international appliances. Some of the valuable firms in the United States are “Clairton Works”, “Edgar Thomson Works”, and “Irvin Plant”, which are all members of “Mon Valley Works”
- ‘North America’ has the largest coking facility, “Clairton Works”. “Edgar Thomson Works” is one of the oldest steel mills in the world. The company got hold of “Great Lakes Works” and the “Granite City Works”, both large integrated steel mills. In 2003, partnered with “Severstal North America” in running the world’s largest electro-galvanizing line, “Double Eagle Steel Coating Company”, at the historic Rouge complex in ‘Dearborn, Michigan’.
- “US Steel’s” biggest home facility is “Gary Works”, in ‘Gary, Indiana’. Gary consists of US Steel Yard baseball stadium. “US Steel” runs a tin mill they bought in ‘East Chicago’, now known as ‘E.C. Tin’ after ‘L.T.V.’ went bankrupt.
- In ‘Portage, Indiana’, “US Steel” runs a sheet and tin finishing facility known as ‘Midwest Plant’ acquired from the “National Steel’s” bankruptcy.
- “US Steel” also operates “Fairfield Works” in ‘Fairfield, Alabama’ (Birmingham) which gives employment 1500 people, and it still operates as a sheet galvanizer. Operation at the “Fairless Works” facility in ‘Fairless Hills, Pennsylvania’, employs 75 people.
- “US Steel” got hold of “National Steel” and simultaneously runs “Great Lakes Works” in ‘Ecorse, Michigan’, “Midwest Plant” in ‘Portage, Indiana’, and “Granite City Steel” in ‘Granite City, Illinois’. A major expansion of ‘Granite City’ was declared, consisting of a new coke plant with an annual capacity of 650,000 tons, in 2008.
- “US Steel” has five pipe mills under its empire: “Fairfield Tubular Operations” in ‘Fairfield, Alabama (Birmingham)’, “Lorain Tubular Operations” in ‘Lorain, Ohio’, “McKeesport Tubular Operations”, in ‘McKeesport, PA’, “Texas Operations (Formerly Lone Star Steel)” in ‘Lone Star, TX’, and “Bellville Operations” in ‘Bellville, TX’.
- “US Steel” has two important taconite mining and pelletizing operations in northeastern Minnesota’s Iron Range by the name “Minnesota Ore Operations”. The “Minntac mine” is near ‘Mountain Iron, Minnesota’ and the “Keetac mine” lies near ‘Keewatin, Minnesota’. “US Steel” announced on February 1, 2008 that it would be investing approximately $300 million on upgrading the operations at ‘Keetac’, a facility purchased in 2003 from the now-defunct and bankrupt “National Steel Corporation”.
- “US Steel” has completely shut two of its major mills. The “Duluth Works” in ‘Duluth, Minnesota’ in 1987, followed by South Chicago’s “South Works” in 1992.
- Internationally, “US Steel” operates facilities in Slovakia (former “East Slovakian Iron Works” in Košice). It also has facilities in Serbia – former ‘Sartid’ with facilities in ‘Smederevo’ (steel plant, hot and cold mill) and ‘Šabac’ (tin mill). End of January 2012, “U.S. Steel” sold its loss making Serbian mills outside Belgrade to the “Serbian Government”.
- Recently, “US Steel” expanded its empire. In ‘Texas’, with the purchase of “Lone Star Steel Company”, ‘Pittsburg, California’ and “POSCO” of ‘South Korea’. It also purchased “Stelco” (now “US Steel Canada”) to expand itself in the Canadian market, with works in ‘Hamilton’ and ‘Nanticoke’, ‘Ontario’.
- In 2008, the corporation opened a new training facility, the “Mon Valley Works Training Hub”, in ‘Duquesne, Pennsylvania’. The hi-tech facility is located on a portion of the property which was once occupied by the company’s “Duquesne Works” which now serves as the primary training site for workers at “US Steel”.
Northampton and Bath Railroad
- The “Northampton & Bath Railroad” was once the property of “US Steel”. The N&B, an 11-kilometer short lined railroad was built in 1904 which served “Atlas Cement” in ‘Northampton, Pennsylvania’, and “Keystone Cement” in ;Bath, Pennsylvania’. Hence, the name “Northampton and Bath Railroad”. But, in 1979, cement shipments had dropped off and were left in such a condition that the railroad was no longer usable and the line was abandoned.
- A 1.5-kilometer section of track was left to work for “Atlas Cement”. The remainder of the N&B was turned into the “Nor-Bath Trail”.
- Before 1860, steel was an expensive product and was used only in premium products like ‘knives’, ‘swords’, etc. All large metal equipment were made from ‘wrought iron’ or ‘cast iron’. The introduction of cheap steel was possible only due to the ‘Bessemer’ and the ‘open hearth’ processes, both advances made in England.
- ‘Henry Bessemer’ demonstrated the process in 1856 and had a successful operation under process by 1864. By 1870, Bessemer steel was widely used for ship plate. By the 1850s, the speed, weight and quantity of railway traffic couldn’t expand because of the limitation of iron rails. The solution was to make steel rails, which the Bessemer process made competitive in price. This solution gave new paths to heavy and faster engines.
- After the 1890, the ‘Bessemer process; was replaced by the ‘open-hearth steel making’ and by the mid-20th century, ‘Bessemer process’ was scrapped. Germany and France were the locations where the ‘open-hearth steel making’ originated, during the 1860s. The initial open-hearth process used pig iron, ore and scrap, & soon it got its new name as “Siemens-Martin process”. By the 1900, the “electric arc furnace” was adopted to steel making and by the 1920s, the decreasing prices of electricity permitted the manufacturers to supplant the crucible process for specialty steels.
Other Key Market Trends
Apogee and decline
- The industry grew gradually but other mills grew at an explosive pace, such that by 1967, accountancy of steel remained for 4.4% of manufacturing employment and 4.9% of manufacturing output. After 1970, American steel manufacturers were not able to compete effectively.
- Per-capita steel consumption in the US was at the tippy top of demand mountain in the 1977, then it suddenly fell by half before staging a modest recovery to levels well below the peak.
- Most of the mills were shut. “Bethlehem” faced bankruptcy in 2001. In 1984, “Republic Steel” merged with “Jones and Laughlin Steel Company”, but the new firm too went bankrupt in 2001. “US Steel” classified itself into oil (“Marathon Oil” was shut in 2001). Finally, the “US Steel” rose back in 2002 with plants in 3 locations in America, plus one in Europe. By 2001, steel accounted for only 0.8% of manufacturing employment and output, both.
What’s with the Steel Industry in USA?
- “Mr. J. P. Morgan” and “Mr. Elbert H. Gary” founded “US Steel” in 1901 by merging “Carnegie Steel Company” owned by “Mr. Andrew Carnegie”, “Federal Steel Company” owned by “Mr. Elbert H. Gary” and “National Steel Company” owned by “Mr. William Henry ‘Judge’ Moore” for $492 million. At one time, US Steel was the largest steel producer and largest corporation in the world. It was capitalized at $1.4 billion.
- The company’s HQ was built in 1901 inside the “Empire building”, bought from “Mr. Orlando B. Potter’s” estate at $5 million. In 1907, the “US Steel” bought its remaining competitor, the “Tennessee Coal, Iron and Railroad Company”, which was HQ at “Birmingham, Alabama”. This led to Tennessee coal’s being replaced in the “Dow Jones International average” by the “General Electric Company”.
- The “Federal Government” decided to attack the “US Steel” by using federal anti-trust laws in 1911, but all that effort went in vain. In its 1st year of full operation, “US Steel” produced 67% of total steel manufactured in the US. 100 years later, its shipments accounted for only approx. 8% of domestic consumption.
In the middle of the century
- “US Steel” was ranked at 16th amongst the United States corporations in the value of WW-II production contracts. Their production was at more than 35 million tons in 1953. Its employment capacity was the greatest in 1943 when it had more than 3,40,000 employees, by 2000, however, it employed just a mere 52,500.
- President “Mr. Harry S. Truman” attempted to take over its Steel mills in 1952 to resolve a crisis with its union, the “United Steelworkers of America (USW)”. The Supreme Court blocked the takeover by stating that the president did not have the constitutional authority to seize and take over the mills.
- On the other hand, president “Mr. John F. Kennedy” was more successful. In 1962, he pressured the steel industry for not to increase their prices as Kennedy considered it to be dangerously inflationary.
The United Steel Group (X) Period
- In 1984, the “Federal Government” blocked “US Steel” from acquiring “National Steel”, and the politically increasing burden from the “US Congress” and the “United Steelworkers (USW)” forced the company to abandon its plans to get into importing British Steel slabs. In 2003, “US Steel” finally acquired “National Steel’s” assets after “National Steel” faced bankruptcy.
- As part of its working-by-classifying plan, “US Steel” acquired the “Marathon Oil”, and “Texas Oil and Gas” several years later. Spotting its new areas for growth, it formulated its holdings as “USX Corporation” in 1986, with “US Steel” (brand USS, Inc.) as a major subsidiary.
- An approximate 22,000 USX workers went on strike on August 1, 1986, after the “USW” and the “US Steel” could not agree on their new employee contract terms. This was recognized by the company as a strike and by the union as a lockout.
- Most USX facilities became idle. February 1, 1987, degrading steel division’s market share. A compromise was accepted by the workers on January 31, 1987. On February 4, 1987, three days after the compromise had been accepted, USX announced that 4 of their mills would be shut down, giving rise to 3,500 unemployed workers.
- When the 20th century’s end was near, the corporation realized that much of its revenue and net income was being derived from its operations in energy, which was led by Chief Executive Officer “Mr. Thomas Usher”. “US Steel” dropped the curtain of “Marathon” and other non-steel assets (except railroad department of the company “Transtar”) and grew in the international market for the 1st time by buying operations in ‘Slovakia’ and ‘Serbia’.
- “US Steel”, on May 2, 2014, declared classified number of job cutoffs, resulting into affected employees, worldwide. “US Steel” was removed from “S&P 500” index and placed in the “S&P MidCap 400” Index on July 2, 2014 in light of its continuous declination in market capitalization.
Employees or activists?
- “US Steel” followed the labour policies which were laid by “Mr. Andrew Carnegie”, which stood in the preference for low wages and opposition to go under unionization. The “Amalgamated Association of Iron and Steel Workers” union which stood on behalf of workers at the ‘Homestead, Pennsylvania’, plant broke after 1892’s violent strike.
- “US Steel” defeated yet another strike in 1901, the year it was founded. In 1906, “US Steel” gave rise to the city of ‘Gary, Indiana’ and 100 years later, it acted as the location of the largest integrated steel mill.
- “US Steel” was at easement with unions during the WW-I, and when “Wilson Administration” started pouring some pressure, it relaxed its opposition to unions, enough to allow some to operate in certain factories.
- As the war ended, it soon came back with its old policies, however, and in a 1919 strike, it defeated the union-organizing efforts by “Mr. William Z. Foster” of the “AFL”.
- The company was forced to give up on its 12-hour day because of heavy pressure and it adopted the 8-hour day. “US Steel”, during the 1920s, like many other large-scale employers, coupled employment practices with “Employee Representation Plans” (ERPs), which were sponsored by management, but under company unions.
- Now, these ERPs became the key aspect for the “United Steelworkers of America”. When “Mr. Myron Taylor”, then president of “US Steel”, agreed to acknowledge the “Steel Workers Organizing Committee”, the right hand of the “Congress of Industrial Organizations (CIO)” led by “Mr. John L. Lewis”, the company had to drop the hard-line, anti-union stance in 1937.
- Taylor, an outsider, was brought in during the Great Depression to rescue the “US Steel”, and had no emotional investment.
- Taylor, watching the chaos caused by the “United Auto Workers” who successfully laid a strike in ‘Flint, Michigan’, and convinced that Lewis was someone he could deal with on a businesslike basis. Taylor was the one who sought stability through collective bargaining.
- In 1974, the union of Steelworkers tried to mollify the problems of competitive foreign imports by agreeing an “Experimental Negotiation Agreement (ENA)”. This agreement had taken place to prevent strikes in matters of serious conflicts between the workers and the owners. ENA could hardly stop the declination of the steel industry in the US.
- In 1984, ENA was scrapped by every other steel producing firm. In 1986, employees of “US Steel” barricaded work after a dispute over contract terms, treated by the company as a strike and by the union as a lockout.
- In a letter to striking employees in 1986, “Mr. Johnston” said, “There are not enough seats in the steel lifeboat for everybody.” Neither the concessions nor the anti-dumping laws could restore the industry to the prestige it once had.
What about the environment?
- 1948, Donora smog, an air inversion got hold of an industrial effluent (air pollution) from the “American Steel and Wire” plant and “US Steel’s Donora Zinc Works” in ‘Donora, Pennsylvania’.
- “In three days, 20 people died… After the inversion lifted, another 50 died, including Lukasz Musial, the father of baseball great Stan Musial. Hundreds more finished the rest of their lives with damaged lungs and hearts. But another 40 years would pass before the whole truth about Donora’s bad air made public-health history.” Today the town is home to the ‘Donora Smog Museum’ which sings the effect of the Donora Smog.
- “Political Economy Research Institute’s” scholars have ranked “US Steel” as the 8th greatest commercial producer of air pollution in the United States. “US Steel”, in 2008 released more than 1 million kg of toxins, majority of which were ‘ammonia’, ‘hydrochloric acid’, ‘ethylene’, ‘zinc compounds’, ‘methanol’, and ‘benzene’, including ‘manganese’, ‘cyanide’, and ‘chromium compounds’.
- The city of ‘River Rouge, Michigan’ and the residents of River Rouge and the nearby city of ‘Ecorse’ filed a high-level lawsuit against the company in 2004 for “the release and discharge of air particulate matter…and other toxic and hazardous substances” at its River Rouge plant.
- Charges against “US Steel” have also been registered in generating water pollution and toxic waste. “Environmental Protection Agency (EPA)” issued an order for the firm in 1993 to clean up a site in ‘Fairless Hills, Pennsylvania’, on the Delaware River, where the soil had been diagnosed positive for ‘arsenic’, ‘lead’, and other heavy metals, as well as ‘naphthalene’, groundwater at the site was found to be polluted with ‘polycyclic aromatic’ hydrocarbon and ‘trichloroethylene(TCE)’.
- The “EPA”, “United States Department of Justice”, and the “State of Ohio”, in 2005 reached on a decision, according to which “US Steel” was supposed to pay more than $100,000 in penalties and $294,000 in reparations in answer to allegations that the company illegally released pollutants into Ohio waters.
- “US Steel’s” ‘Gary, Indiana’ facility has been continuously charged with releasing polluted wastewater into ‘Lake Michigan’ and the ‘Grand Calumet River’, and in 1998 agreed to a settlement of $30 million to clean up the contaminated sediments of the river.
The Empire, broken but remained unbroken
- The “US Steel Tower” standing in ‘Pittsburgh, Pennsylvania’ is named after the company, the tallest skyscraper in the downtown Pittsburgh skyline. “One Liberty Plaza” of ‘New York’ was also built by this corporation in 1973.
- When the “Steelmark” logo came into existence, “US Steel” had the following meaning attached to it: “Steel lightens your work, brightens your leisure and widens your world.” The logo was majorly used as part of marketing campaigns to spread awareness to consumers about the importance of steel daily lives. The “Steelmark” logo, existed in radio, newspapers and television advertisements. It was even used as labels for all steel products, ranging from steel tanks to tricycles to filing cabinets.
- In 1964, “US Steel” showcased its constructed ‘Unisphere’ in the World Fair. It is the largest globe ever made and is one of the world’s largest free standing sculptures.
- In “The Godfather Part II”, ‘Hyman Roth’ tells “Michael Corleone”, “Michael, we’re bigger than US Steel”.
Market Size and Forecast
Ancient time of steel in different locations
- Britain led the world’s “Industrial Revolution” with its early commitment to coal mining, steam power, textile mills, machinery, railways and ship building. Britain’s exceeding demand of iron and steel, combined with the ample capital and powerful entrepreneurs, made it the world leader in the first half of the 19th century.
- In 1875, Britain was responsible for 47% of world production of pig iron and almost 40% of steel. 40% of production quantity was exported to US, which was growing its rail and industrial infrastructure. After 20 years, in 1896, the British share of pig iron came to 29% and 22.5% for steel, and very little of which, was sent to US.
- Now, the US was the world leader and Germany had almost taken the place of Britain. Britain lost its American market, and was losing its power elsewhere. Indeed, the American products started getting banned in Brtain.
- The “Broken Hill Proprietary Company (BHP) Newcastle Iron and Steel Works” was a major steel mill from 1915 until its closure in 1999. McIntyre (2005) looked at its skilled boilermakers, their culture and role of work in the steelwork’s context. McIntyre explores the world of the steelworks boilermakers as a species of valuable industrial men, including the ideas, values, symbols and practices which shaped his expectations, outlook and actions as a skilled industrial worker, by drawing on historical method, cultural studies and social theory.
- The Ruhr valley provided an excellent location for the German iron and steel industry because of the availability of raw materials, coal, transport, a skilled labour force, nearby markets and an entrepreneurial spirit that led to the existence of many firms, often in close conjunction with coal mines.
- By 1850, Ruhr had 50 iron works with 2,813 full-time employees. The first modern furnace was built in 1849. The rise of the German Empire in 1870 gave further rapid growth to its country. Mixed enterprises could unite all levels of production through vertical integration, thus lowering production costs. Technological progress brought new advantages as well.
- German steel production grew explosively from 1 million tons in 1885 to 10 million in 1905 and rose to 19 million in 1918. In the 1920s, the production was 15 million tons, but the output was a mere 6 million in 1933. Under the rule of Nazis, steel output peaked at 22 million tons in 1940, but the dropped to 18 million in 1944 under ‘Allied bombing’. The alliance of four major firms into “German Steel Trust” in 1926 was modeled on the US Steel Co. in the US.
- The French Iron industry was behind the Belgium’s in the early 19th century, and after the 1850, they were behind Germany too. Its industry comprised of too many small, inefficient firms. Twentieth century growth was not robust, due to more traditional, social and economic attitudes than to inherent geographic, population or resource matters. Despite a high national income level, the French steel industry was always behind.
- The industry was based on a large supply of iron and coal, which was dispersed across the country. The greatest output came in 1929, which was 10.4 million tons. The industry suffered sharply during the Great Depression and the WW-II. Prosperity came back by the mid-1950s, but profits came largely from strong domestic demand than rather competitive capacity.
- In Italy, shortage of coal led the steel industry to specialize in the use of hydro-electrical energy, exploiting ideas pioneered by Mr. Ernesto Stassano from 1898. Despite the periods of innovation (1907-14), growth (1915-18) and consolidation (1918-22), early expectations were only partly realized. Steel output in the 1920s and 1930s averaged about 2.1 million tons.
- Italy modernized its industry in the 1950s and 1960s, and it grew exponentially. It was second only to West Germany in the 1970s. String labour unions kept employment levels high. Troubles multiplied after 1980. In the 1980, the largest producer “Nuova Italsider” lost 746 billion lira in its inefficient operations.
- From 1875 to 1920, America’s steel production saw a steep inclinations from 3,80,000 tons to 60 million tons annually, making US the dominant world leader. The annual growth rates in steel during 1870-1913 were 7% for the US, 1% for Britain, 6% for Germany and 4.3% for France, Belgium and Russia, and other major producers. This exponential growth rested on solid technological foundations, assisted by other factors, including the protective tariff and the continuous rapid expansion of urban infrastructures, office buildings, factories, railroads, bridges and other sectors that increasingly demanded steel.
- In 1869, Iron was already a major industry, which was accounting for 6.6% of manufacturing employment and 7.8% of manufacturing output.
- Yonekura showed that the steel industry was central to the economic development of Japan. The nation’s sudden transformation from feudal to modern society in the late 19th century. Its heavy industrialization and war ventures in 1900-1945, and the post WW-II high-economic growth, all were depended on iron and steel industry. From 1850 to 1970, the industry increased its crude steel production from virtually nothing to 93.3 million tons.
- “Tata Iron and Steel Company (TISCO)” was established by “Dorabji Tata” in 1907. By 1939, it operated as the largest steel plant in the “British Empire”.
- Prime Minister “Mr. Jawaharlal Nehru”, a true believer in socialism, decided that the technological revolution in India needed maximization of steel production. He, therefore, formed a government owned company, “Hindustan Steel Limited (HSL)” and set up three steel plants in the 1950s.
- The Indian steel industry began expanding into Europe in the 21st century. In January 2007 India’s Tata Steel made a successful $11.3 billion offer to buy European steel maker “Corus Group”. In 2006 “Mittal Steel” (based in London but with Indian management) acquired “Arcelor” for $34.3 billion to become the world’s biggest steel maker, “ArcelorMittal”, with 10% of the world’s output.
- Communist party dictator “Mao Zedong” disdained the cities and put his faith in the Chinese peasantry for a Great Leap Forward. Mao saw steel production as the key to overnight economic modernization, promising that within 15 years China’s steel production would surpass that of Britain.
- In 1958 he decided that steel production would get doubled within the year, using backyard steel furnaces run by inexperienced peasants. The plan was a blunder, as the small amounts of steel produced were of very poor quality, and the diversion of resources out of agriculture produced a massive famine in 1959-61 that killed millions.
- With economic reforms brought in by “Deng Xiaoping”, who led China from 1978 to 1992, China began to develop into a modern steel industry by building new steel plants and recycling scrap metal from the United States and Europe.
- As of 2013 China produced 779 million metric tons of steel each year, making it by far the largest steel producing country in the world. This is compared to 165 for the European Union, 110 for Japan, 87 for the United States and 81 for India. China’s 2013 steel production was equivalent to an average of 3.14 cubic meters of steel per second.
The future of Made-In-America Steel
- The business of steel has come a long way in the last century, no doubt in that.
- It is still an essential and required metal, used to make cars, pipelines and skyscrapers. It is made in factories which are now run by robots, which replaced the ‘sweat and muscle’. And as it industrializes and grows, the world needs more steel. In 2012, global production of crude steel hit a record 1.55 billion tons, up 1.2% from 2011.
- In the U.S., where the production sector is not having its days, steel production – led by mills run by “US Steel Corp”, X +7.91% and “ArcelorMittal” MT +5.86% in the Midwest, and “Nucor Corp”. NUE +3.82% in the South — rose 2.5% to 88.5 million tons last year.
- U.S. still remains the world’s third biggest steel manufacturer, but ahead of emerging powers such India, Russia and Brazil.
- “US Steel” and “ArcelorMittal” have been racing to develop steel for the “Detroit Auto Industry” and pipes for the shale gas revolution.
- The different stages of steel development have one big reason that tensions have emerged over China exporting its expertise in low-cost bridge building and repair to the U.S.
- But “US Steel” firms also say the mismatch presents an opportunity. They hope to export the technology they’ve developed in state-of-the-art steel.
- The stakes are so high for “US Steel”, “ArcelorMittal” and others steel firms, which are trying to get into Chinese market, given that the Chinese government lifts its restrictions on selling foreign steel in China.
Large Scale Steel production companies
- Mr. Charles Schwab (1862-1939) and Mr. Eugene Grace (1876-1960) made “Bethlehem Steel the second-largest American steel company by the 1920s. Schwab was the ‘Operating Head’ of ‘Carnegie Steel’ and ‘US Steel’. In 1903, he purchased a small firm by the name “Bethlehem Steel” and in 1916, made Grace the president. Innovation was the key to success at a time when US Steel under Judge Gary moved slowly.
- Bethlehem Concentrated on government contracts, such as ships and naval armour, and on construction beams, especially for skyscrapers and bridges. Its subsidiary “Bethlehem Ship building Corporation” operated 15 ship yards in WW-II. It manufactured 1,121 ships, more than anyone during the war and approximately one-fifth of the US Navy’s fleet. Its peak employment was 1,80,000 workers, out of a company-wide wartime peak of 3,00,000. After the 1945, Bethlehem made its production quantity twice, a measure of widespread optimism in the industry.
- After Grace retired the inbred executives, concentrated on short term profits and postponed innovations, which further led to bankruptcy in 2001.
- Mr. Cyrus Eaton (1883-1979) in 1925 purchased the small-company “Trumbull Steel Company” of Warren, Ohio for $18 million. In the late 1920s, he also purchased the undervalued steel and rubber companies. In the 1930, Eaton consolidated his steel holdings into the “Republic Steel”, based in Cleveland. It became the third-largest steel producer in US, after “US Steel” and “Bethlehem Steel”.
- The “American Federation of Labour (AFL)” tried and failed to keep the steel workers organized in 1919. Although, the strike gained a tremendous middle-class support because of its demands and the 12-hour day. The strike did not have the outcome as expected and the unionization was postponed until the late 1930s. The Mills ended the 12 hour day in the early 1920s.
- When the “Steel Workers Organising Committee” was set up, the next surge of unionization came under the aegis of the militant CIO in the late 1930s. The SWOC focused only on the achievement of the terms of the signed contract, with “Little Steel” (one of the major producers, except for US Steel). The female workers, workers on the assembly line, and middle-class liberals from all over the Chicago decided to turn their strike into something larger than just a mere show over the union recognition. Unfortunately, the effort failed, whereas the strike was won, the resulting powerful “United Steelworkers of America” union suppressed the local’s opinions.
- Nucor Steel Seattle, Inc. presentation on “American Steel Companies”