Weekly Production Shows Encouraging Momentum

The American steel industry demonstrated positive momentum in the most recent reporting period, with domestic raw steel production reaching 1,740,000 net tons for the week ending May 10, 2025. This output represents a notable 1.8% increase compared to the same week in 2024, when production stood at 1,709,000 net tons. The weekly figures also show short-term growth, with production rising 0.9% from the previous week's total of 1,725,000 net tons. This upward trajectory suggests strengthening demand for steel products across various sectors of the economy, potentially reflecting increased activity in construction, automotive manufacturing, and infrastructure development. The steel industry's performance serves as an important economic indicator, as it typically correlates with broader industrial activity and economic health. These latest figures may signal that manufacturers and construction companies are maintaining confidence in near-term economic conditions despite ongoing concerns about inflation and interest rates.

Capability Utilization Rate Climbs to 77.5%

A key metric for assessing the steel industry's operational efficiency, the capability utilization rate, reached 77.5% for the week ending May 10, 2025. This represents an improvement from both the previous week's rate of 76.8% and the year-ago period's 76.9%. The capability utilization rate measures what percentage of the industry's total production capacity is being actively used, with higher numbers generally indicating stronger demand and healthier market conditions. While the current 77.5% rate shows improvement, it remains below the 80-85% threshold that industry analysts typically consider optimal for balancing supply with demand and maintaining price stability. Nevertheless, the upward trend in utilization rates suggests that steel producers are gradually bringing more capacity online to meet increasing orders. This measured approach to ramping up production helps prevent oversupply situations that could potentially destabilize pricing in the highly competitive global steel market.

Year-to-Date Production Shows Slight Decline

Despite the positive weekly figures, the broader year-to-date picture reveals some ongoing challenges for domestic steel producers. Adjusted production through May 10, 2025, totaled 31,066,000 net tons, representing a 0.9% decrease from the 31,334,000 net tons produced during the same period in 2024. Similarly, the year-to-date capability utilization rate of 74.9% lags behind last year's rate of 76.1% for the comparable timeframe. This annual comparison indicates that while recent weeks have shown improvement, the industry has not fully recovered from slower production earlier in the year. Several factors may have contributed to this year-to-date decline, including high energy costs, supply chain disruptions, and competition from imported steel products. The contrasting trends between recent weekly improvements and the year-to-date decline highlight the cyclical nature of steel demand and the industry's ongoing efforts to adapt to changing market conditions throughout 2025.

Southern District Leads Regional Production

Breaking down production by geographic districts provides insight into regional economic activity and the distribution of steel manufacturing across the country. For the week ending May 10, 2025, the Southern district led production with 747,000 net tons, accounting for approximately 43% of total domestic output. The Great Lakes district followed with 552,000 net tons, representing roughly 32% of the national total. The Midwest contributed 241,000 net tons (14%), while the Northeast and Western districts produced 133,000 (7.6%) and 67,000 (3.8%) net tons, respectively. This regional distribution reflects the established manufacturing infrastructure in each area, with the Southern and Great Lakes districts benefiting from proximity to automotive manufacturing, energy production, and major transportation networks. The concentration of production in these regions also aligns with historical patterns of industrial development and the location of major integrated steel mills and electric arc furnace facilities that form the backbone of American steel manufacturing.

Key Takeaways:

• Domestic raw steel production reached 1,740,000 net tons for the week ending May 10, 2025, representing a 1.8% increase from the same period last year and a 0.9% rise from the previous week, with capability utilization climbing to 77.5%

• Despite recent weekly improvements, year-to-date production through May 10, 2025, stands at 31,066,000 net tons, down 0.9% from the same period in 2024, with capability utilization averaging 74.9% compared to 76.1% last year

• The Southern district leads regional production with 747,000 net tons (43% of total), followed by the Great Lakes district with 552,000 net tons (32%), reflecting the geographic distribution of steel manufacturing capacity across the country