U.S. Steel announced plans to resume steel production at its Granite City Works facility in Illinois, a site that has been inactive for two years. The company decided to restart operations in response to a rebound in customer demand, reversing its earlier decision to phase out steel processing at the plant. This decision follows significant pressure from the White House and aims to address the growing need for steel in various sectors.
The Granite City plant, located in Southern Illinois just across the Mississippi River from St. Louis, previously saw the last blast furnace shut down in 2023. U.S. Steel had moved to wind down its steel processing mill in September but has now made the decision to reopen the blast furnace that was idled two years ago. According to U.S. Steel CEO David Burritt, “After several months of carefully analyzing customer demand, we made the decision to restart a blast furnace.” He added that while the steel industry is competitive and cyclical, the company is confident in its ability to safely operate the mill to meet expected demand through 2026.
Production is expected to resume in the first half of 2025, as U.S. Steel prepares to hire and train workers and ensure that equipment is operational. The company announced it plans to hire approximately 400 of the 500 workers necessary to fully operate the plant.
Revival in the Steel Industry
Currently, the United States has only 12 operating blast furnaces, a significant drop from around 140 in the 1970s, largely due to foreign competition impacting the American steel industry. Notably, no new blast furnaces have been built in the U.S. in decades. However, recent economic conditions have shown improvement, fueled by tariffs imposed during the administrations of Donald Trump and Joe Biden. Analysts highlight that the domestic steel market has strengthened, aided by a resurgence in automaking and construction.
Data from the American Iron and Steel Institute reveals that domestic steel mills shipped 7.7 million net tons in October 2024, representing a 9% increase compared to the same month in the previous year. Year-to-date shipments have risen by 5% over the same period in 2023.
U.S. Steel’s decision comes shortly after Nippon Steel, a Japan-based company, reached an agreement with the U.S. government to acquire the American steelmaker for $14.9 billion. As part of this acquisition, Nippon Steel agreed to give the federal government a role in specific company decisions related to domestic steel production, including any potential plant closures or idling of facilities. Furthermore, the company pledged to invest approximately $14 billion in U.S. steel production, which includes plans to build a new electric furnace.
Under the terms of the national security agreement associated with the Nippon Steel acquisition, protections for Granite City Works will remain in place until 2027, while other U.S. Steel facilities will be covered until 2035. The Granite City Works plant primarily produces rolls of sheet steel used across various industries, including construction, container manufacturing, pipe production, and automotive sectors.
This strategic move signals a potential revitalization of the American steel industry, aiming to meet both domestic and international demand as economic conditions continue to evolve.
