USA Steel production down 43.8% from same week

[doc03]

last year. the week of December 6, 2008 steel production was 1,182,000 tons the same week last year 2,102,000 tons down about 1,000,000 tons per week. This is just one industry that is seeing the affect of poor auto sales. The steel industry is losing millions of dollars a week working at those levels of production. To put this in perspective my plant produced around 2,300,000 tons the entire year of 2007 we employ around 3000. So losing 1,000,000 tons per week that adds up to 52,000,000 tons a year and maybe 60,000 jobs.
http://www.steel.org/AM/Template.cfm?Section=Raw_Steel_Production1&TEMPLATE=/CM/HTMLDisplay.cfm&CONTENTID=23211

[ogneopasno]

1. This affects rail and shipping in NE Minnesota too. We need to get Obama's infrasturcture plan

passed -- steel builds roads, cars, trains, and so on. Steel is the backbone of this nation and we forget it at our peril.

[doc03]

3. Obama's infrastructure plan will help us

tremendously, our main consumer other than autos is the construction industry. People don't think if not for the steel and auto industry we would be speaking German today. The steel plant I work in produced guns and shells back in WWII. The auto industry turned out tanks, jeeps etc. and Ford build thousands of airplanes. If we lose any more of our manufacturing base this country is finished. Would you believe we used to be the worlds number one steel producer now China produces 6 times what we do.

[ogneopasno]

6. I know, it makes me sick. The mines served by the railroad my partner's on supplied Ford with steel

for decades. And those mines, railroads and shipping jobs made it possible for the children of those workers to go to college -- or stay in the towns and work at living-wage jobs if they didn't want to go to college, buy houses, and raise their own families. Exactly the economic engine that should be running America -- not shuffling imaginary money from one account to another with imaginary worth and interest added in.

Where do you work?

[doc03]

9. My company was Wheeling Pittsburgh Steel

but we were bought out this summer by a Russian company Severstal NA. They also bought the Rouge Steel plant at the Ford River Rouge plant in Dearborn, Warren Steel in Ohio, the old Bethlehem Steel Sparrows Point plant in Baltimore and they built a new plant in Mississippi.

[ogneopasno]

10. Severstal is certainly pouring the money into the U.S.

But somehow "Severstal" just doesn't have the ring that "Wheeling Pittsburgh Steel" does.

[doc03]

11. So far they have been a good employer

of course things are tight now. Wheeling Pittsburgh Steel has changed hands a half dozen times in the 38 years I have been there. Every new owner came in raped and pillaged the company then sold it off to an even worse SOB. So far I think the Russians buying us is the best thing ever happened they have money and I think they will modernize the place instead of just selling off the good parts and leaving.

[ogneopasno]

12. I'm glad to hear it.

CN bought my partner's railroad a couple years ago and are busy trying to run it into the ground. It's a complete nightmare.

[Wickerman]

2. Maybe off topic, but didn't US Steel just show a big gain in the market?

not arguing with you, that news is alarming. I was feeling a shred of encouragement for the industry when I heard that news so your take is a little frightening, probably more realistic.

[doc03]

4. I haven't checked prices today but I would guess all steel

gained today because of Obama's infrastructure program he announced Sunday. His plan will create a big demand for steel. the company I work for gained about 30 % today I believe. We are hurting bad right now, we have 800 or so laid off at my plant.

on edit: I checked US Steel up 24% and they are crediting Obama's plan for the increase.

[economicgeography]

5. re:

Seeing as steel is an mainly an intermediate good, it doesn't come as too much of a surprise. There simply isn't enough worldwide demand to justify higher levels of production.

I would not be surprised if the housing bubble spurred higher output and employment levels over the last few years. I don't know what they make houses out of anymore nowadays but I figure steel has to still have some sort of role.

[ogneopasno]

7. Houses are largely stick-framed. I wish more people would frame houses with steel.

Aside from being better for the steel market (in which I have an interest), it would make better houses.

[doc03]

8. Steel has been doing real well the last couple years

mainly because the Chinese are using so much they haven't been dumping it on our market. Steel prices were also at unbelievable levels because the Chinese have been buying up all the scrap.
A few years ago hot rolled bands were going for $260 a ton and last year they were going for over $900 a ton. We were paying over $500 a ton for scrap steel last summer and today the price has collapsed to $90. Depending on the production process 25% to 60% of steel is produced from recycled scrap. Right now the industry is operating at 49% of capacity the market just vanished the middle of August.

[Recursion]

13. I'm betting that's the Chindia hit

US steel has had a renaissance because Chinese and Indian companies want steel and we can get it to them pretty cheaply. Once our bankers managed to kill the Chindian economies, though, US steel started going back where it had been for decades.