US Steel to idle two US blast furnaces, one in Europe
US Steel late Tuesday said that in response to market conditions it will idle two blast furnaces at sheet mills in the US as well as a BF in Europe until markets rebound.
In moves to "better align our global production with our order book" the B2 blast furnace at the Great Lakes Works in Michigan will remain idle after a planned maintenance outage that started last week, and a BF at the Gary Works in Indiana will be temporarily idled.
With the US moves, the steelmaker expects to decrease monthly BF production capacity by about 200,000-225,000 short tons beginning in July. "If both furnaces remain idled for the remainder of the year, we expect full-year Flat-Rolled shipments to third party customers to be approximately 11.0 million tons," US Steel stated.
"We will resume blast furnace production at one or both idled blast furnaces when market conditions improve."
US Steel had 10.5 million st of Flat-Rolled segment shipments last year.
At US Steel Europe (USSE) in Kosice, Slovak Republic, the No. 2 BF, which can produce about 125,000 st/month, will be idled. US Steel said USSE "continues to be negatively impacted by increasing levels of imports and continued market headwinds related to raw material costs and demand."
If the European BF remains idle for the remainder of 2019, full-year USSE shipments to third party customers are expected to be roughly 3.6 million st. USSE shipped 4.46 million st last year.
"While market conditions have softened, we remain focused on executing the value creation strategy that is underway," US Steel stated in a release.
US Steel also provided second quarter earnings guidance late Tuesday, expecting adjusted diluted earnings per share to be approximately 40 cents. For perspective, the steelmaker had adjusted earnings per diluted share of 47 cents in the first quarter, or $81 million.