USA Flat Steel Market Outlook to 2028

USA Flat Steel Market Overview

• The USA Flat Steel Market was valued at USD 70.3 billion. The market growth is driven by its widespread application in industries such as construction, automotive, and machinery manufacturing. Major infrastructure developments, including highways and bridges, are key factors bolstering demand.
• Major players in the market are United States Steel Corporation, Nucor Corporation, ArcelorMittal USA, Steel Dynamics, and AK Steel. These companies dominate the market due to their extensive production capacities, established supply chains, and strong relationships with key end-user industries such as automotive and construction.
• In 2023, Steel Dynamics announced an investment of $2.2 billion to expand its steel production facility in Texas, aiming to increase its capacity by 3 million tons annually. This move aligns with the increasing demand for flat steel, especially in the automotive and construction sectors. This expansion reflects a positive outlook for the market as manufacturers continue to respond to rising domestic demand.
• The Midwest, particularly states like Indiana and Ohio, dominates the market due to its concentration of steel production facilities and proximity to key end-user industries, such as automotive and machinery manufacturing. The regions established industrial infrastructure and skilled workforce contribute to its dominance.

USA Flat Steel Market Segmentation

The market is segmented into various factors like product, application, and region.

By Product: The market is segmented by product into hot-rolled coils (HRC), cold-rolled coils (CRC), and galvanized steel. HRC dominated the market, with the popularity of HRC is due to its wide application in automotive and construction sectors, as it provides cost-effective solutions for large-scale projects.

By Application: The market is segmented by application into automotive, construction, and machinery manufacturing. The automotive sector held the largest market share, vehicle production and the shift toward electric vehicles (EVs). Flat steel is essential for lightweight, durable components in both traditional and electric vehicles.

By Region: The market is segmented by region into North, South, East, and West. The North, particularly the Midwest region, dominated the market with the major steel production facilities and strong demand from the automotive and machinery manufacturing industries.

USA Flat Steel Market Competitive Landscape

• ArcelorMittal USA: ArcelorMittal has acquired Polish scrap recycling company Zomex, marking its fourth recycling acquisition in Europe this year. Zomex processed nearly 400,000 tonnes of scrap in 2022, supporting ArcelorMittal's goal to reduce carbon emissions by 35% by 2030 through increased use of recycled materials.
• United States Steel Corp.: United States Steel Corporation has broken ground on a $3 billion steel mill in Osceola, Arkansas, expected to be the most advanced in North America. Featuring two electric arc furnaces, it will produce 3 million tons of steel annually and create 900 jobs, with completion anticipated in 2024.

USA Flat Steel Market Analysis

Market Growth Drivers

• Increased Demand from the Automotive Industry: In 2023, the U.S. automotive sector required flat steel, driven by vehicle production. As automakers ramp up production for electric vehicles (EVs), the demand for high-strength flat steel will increase. Government policies aimed at expanding EV manufacturing and adoption will further boost demand in 2024, with additional production needs expected for EV-specific steel components like battery housing.
• Government Infrastructure Investment: The Infrastructure Investment and Jobs Act, signed into law in November 2021, allocates $550 billion in new federal investment for infrastructure projects across the U.S. like roads, bridges, and transit systems, requiring volumes of flat steel. In 2024, this initiative will require tons of steel across various projects, with flat steel being essential for large-scale construction, such as highways and rail networks. This massive infrastructure demand will drive flat steel consumption over the next five years.
• Expansion of Renewable Energy Projects: The U.S. renewable energy sector is set to expand, requiring flat steel for solar panel frameworks, wind turbines, and energy storage systems. In 2023, renewable energy projects required tons of flat steel. With federal tax incentives and a push for green energy projects in 2024, the demand for flat steel for these purposes is expected to rise, particularly in solar and wind energy infrastructure.

Market Challenges

• Rising Raw Material Costs: The price of iron ore, a key raw material for steel production, has increased substantially in 2023. This has caused a 20% rise in production costs for flat steel manufacturers, squeezing profit margins. Steel producers are facing difficulties in absorbing these costs, which will remain a challenge into 2024 as global raw material shortages persist.
• Supply Chain Disruptions: The steel industry is still facing supply chain disruptions from geopolitical conflicts, particularly the war in Ukraine. In 2023, U.S. flat steel imports fell due to these issues. Ongoing shipping and logistical challenges are expected to affect the supply of flat steel in 2024, leading to increased domestic production costs and delivery delays.

Government Initiatives

• Federal Support for Electric Vehicle (EV) Manufacturing: The U.S. government is investing $1.7 billion to support electric vehicle manufacturing across eight states. This initiative aims to revitalize factories, create over 2,900 jobs, and retain around 15,000 union positions, enhancing domestic production of EVs and components while promoting sustainable energy practices.
• Defense Manufacturing Expansion: To enhance defense manufacturing, the government will implement the "Make in America" initiative, creating an Emergency Trade Deficit Commission and promoting clean energy exports with a $75 million fund. This aims to recover from the loss of 5.6 million manufacturing jobs over the past decade and counteract Chinese competition. This investment will continue to fuel demand growth over the next five years.

USA Flat Steel Market Future Outlook

The future of the market will see growth driven by increased demand from electric vehicles, sustainable steel production, and ongoing infrastructure projects. Advancements in high-strength steel, expanding domestic production capacity, and renewable energy development.

Future Market Trends

• Rising Demand for Sustainable Construction Materials: Over the next five years, demand for sustainable construction materials will increase. In 2024, the U.S. government will continue to promote green buildings, pushing demand for flat steel products with lower carbon footprints. By 2028, the market will be dominated by eco-friendly steel, low-carbon steel expected to be used annually in construction.
• Technological Innovations in Steel Production: By 2028, technological advancements such as electric arc furnaces and carbon capture technologies will transform steel production, making it more energy-efficient. In 2024, flat steel produced using these technologies and by 2028, this number will rise annually, reflecting a major shift toward sustainable steel production.