U.S. Steel to Idle Three Blast Furnaces

SEATTLE (Scrap Monster): Pittsburgh-based steel maker U.S. Steel announced its decision to idle two blast furnaces in the U.S. and one in Europe, in response to current weak market conditions.

According to the company, it had begun a planned maintenance outage on the Great Lakes B2 blast furnace last week. The current market conditions may force the company to keep the furnace idled even after completion of the planned outage. In addition, it plans to temporarily idle a blast furnace at its Gary Works facility. Consequently, the monthly blast furnace production capacity will be likely impacted by around 200,000 to 250,000 tons next month onwards. The resumption at one or both of the above blast furnaces is subject to market improvement, U.S. Steel press release noted.

The rising steel imports and escalating raw material costs have continued to negatively impact its European operations. As a result, the company has decided to idle the #2 blast furnace, which is estimated to have a monthly production capacity of nearly 125,000 tons. The resumption of #2 blast furnace will depend on future improvement of market conditions.

U.S. Steel provided guidance for Q2 2019. It expects the adjusted EBITDA during the quarter to be approximately $250 million and the adjusted diluted earnings per share to be around $0.40, both lower than Q1 2019.