US Steel cred­its Trump as it restarts fac­tory project

The Columbus Dispatch - - Business - By Jay Reeves

BIRM­ING­HAM, Ala. — U.S. Steel Corp. will restart con­struc­tion on a man­u­fac­tur­ing fa­cil­ity in Alabama, and it gave some of the credit to Pres­i­dent Don­ald Trump’s trade poli­cies in an an­nounce­ment Mon­day.

Trump’s “strong trade ac­tions” are partly re­spon­si­ble for the re­sump­tion of work on an ad­vanced plant near Birm­ing­ham, the Pitts­burgh­based com­pany said in a state­ment. The ad­min­is­tra­tion’s tar­iffs have raised prices on im­ported steel and alu­minum.

The man­u­fac­turer also cited im­prov­ing mar­ket con­di­tions, union sup­port and gov­ern­ment in­cen­tives for the de­ci­sion.

Work will re­sume im­me­di­ately, the com­pany said, and the fa­cil­ity will have an an­nual ca­pac­ity of 1.6 mil­lion tons.

U.S. Steel said it also will up­date other equipment and plans to spend about $215 mil­lion, adding about 150 full­time work­ers. The fur­nace is ex­pected to be­gin pro­duc­ing steel in late 2020.

The 16,000-mem­ber United Steel­work­ers praised the de­ci­sion to re­sume work, which fol­lowed an agree­ment with the union reached last fall.

“This de­ci­sion paves the way for a solid fu­ture in con­tin­u­ing to make steel in Alabama and the Birm­ing­ham re­gion,” Leo W. Ger­ard, the pres­i­dent of the in­ter­na­tional union, said in a state­ment.

U.S. Steel shut down its decades-old blast fur­nace at Fair­field Works in 2015, idling about 1,100 em­ploy­ees, and said it would re­place the op­er­a­tion with an elec­tric fur­nace.

The com­pany then blamed con­di­tions in the steel, oil and gas in­dus­tries as it sus­pended work in De­cem­ber 2015 on an elec­tric arc fur­nace at its mill in Fair­field, lo­cated just west of Birm­ing­ham. The project stalled un­til the an­nounce­ment Mon­day.

U.S. Steel and other large U.S. steel­mak­ers have ben­e­fited since the Trump ad­min­is­tra­tion be­gan im­pos­ing 25 per­cent tar­iffs on im­ported steel in March of last year, largely be­cause they were able to raise do­mes­tic steel prices. Other coun­tries said the taxes break global trade rules, and some have im­posed tar­iffs of their own.

Last year, ship­ments from U.S. steel pro­duc­ers in­creased 5 per­cent, and steel im­ports are down 37 per­cent since the tar­iffs took ef­fect, said Lisa Har­ri­son, spokes­woman for the Amer­i­can Iron and Steel In­sti­tute, a trade as­so­ci­a­tion. She at­trib­uted the changes to the tar­iffs as well as reg­u­la­tory re­form and a fa­vor­able econ­omy.

But higher prices have hurt the bot­tom lines of steel in­dus­try cus­tomers. Gen­eral Mo­tors, for in­stance, said last week that steel and alu­minum price in­creases due largely to the tar­iffs raised the prices of those com­modi­ties, costing the com­pany more than $1 bil­lion last year. GM ex­pects an­other $1 bil­lion in­crease this year.

U.S. Steel’s rev­enue rose 19 per­cent last year com­pared with a year ear­lier, and it swung from a loss to a net profit of $387 mil­lion.

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