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2. US steel industry is equipped to lead due to ample
supplies of affordable energy through natural gas,
stable labor relations, a vast steel market and a drive
for innovation. Besides these factors, rising
technology and innovation is also continue to drive
the steel industry through challenges faced whether
its trade issues, environmental, or the general
volatility of the global steel economy.
Further, steel has long been considered the
backbone of the country's manufacturing sector,
providing an essential material for downstream
manufacturers in the automotive, energy,
machinery and equipment, container, appliance and
rail industries.
Presently, construction industry accounts major
share of steel consumption in the country followed
by automotive and machinery & equipment
industry. In future, along with construction and
automobile sector, energy sector is also expected to
grow tremendously on the back of tremendous
growth of demand from oil & gas sector.
US Steel Industry - Overview
Figure 1: Steel Shipments by Sector (%), 2012 & 2017
Source: American Iron and Steel Institute, IhS Global Insight
Note: Data is estimated
Source: RNCOS

3. The US is the third largest crude steel
producer in the world after China
(Production 716.5 Million Metric Tons in
2012) and Japan (Production 107.2
Million Metric Tons in 2012). In 2012,
Crude steel production in the country
witnessed an increase of more than 2.5%
to reach 88.6 Million Metric Tons
compared to the previous year. Further, it
is expected to grow at CAGR of around
4.5% during 2012-2017. Besides, country's
share in world's crude steel production in
2012 was 5.7%.
US Steel Industry - Market Size and Growth Rate
Figure 2: Crude Steel Production (Million Metric Tons),
2009-2012 & 2017
Source: World Steel Association, RNCOS
Note: f = RNCOS Forecast
Figure 3: Apparent Steel Consumption (Million Metric Tons),
2009-2012 & 2017
Source: RNCOS
Note: Crude Steel Equivalents
With the improving demand from
various industrial sectors, steel
consumption (Crude Steel Equivalent)
in 2011 grew 10.7% compared to 2010.
However, apparent steel consumption is
anticipated to grow at CAGR of around
4.3% during 2012-17 to reach around
130 Million Metric Tons by the end of
2017.

4. Further, apparent consumption for finished steel
products is grew 8.4% in 2012 from the previous year.
In future, due to the automotive and energy sectors
and an increasingly resilient construction recovery,
apparent steel consumption is forecasted to at a
CAGR of more than 4% during 2012-2017.
Figure 4: Apparent Finished Steel Consumption
(Million Metric Tons), 2012 & 2017
Source: World Steel Association, RNCOS
Note: f = RNCOS Forecast
In 2012, steel exports and import grew more than 10.5% and 1% respectively compared to previous year. In coming
years, export is anticipated to rise further as domestic demand is not expected to reach pre-recession levels before
2015 as construction spending languishes. However, imports growth is expected to be affected by high antidumping
and countervailing duties imposed by the US authorities.
Figure 5: Export and Import of Steel (Million Net Tons), 2010-
2012
Source: World Steel Association, RNCOS

5. In the US, major fraction of the crude steel produced is of continuously cast steel type accounting 98% of the total crude
steel production. Moreover, it is expected that ingots production share will further decline in the coming years due to
high cost of production and various other disadvantages over continuously cast steel process.
US Steel Industry - Market Breakup/Segmentation
Figure 6: Crude Steel Production by Type (2012)
Source: RNCOS
In the US, flat products account for a major share in total apparent steel consumption in the country. In 2012, share
of flat products consumption is estimated to 58% share in total steel consumption, followed by long products.
Figure 7: Apparent Steel Consumption by Type (2012)
Source: RNCOS

6. US Steel Industry - Opportunities and Challenges
▪ Positive momentum from the construction sector will prosper steel industry. Recently, MTA (Metropolitan
Transportation Authority) announced to buy steel from domestic companies for its Verrazano bridge project which
has a demand of 15,000 Tons of steel plate.
▪ The strong growth from automotive industry.
▪ Demand from energy sector is also growing. For instance, US shale gas revolution is going to create a need for more
steel that goes into the pipes to bring the gas to the user.
▪ Upcoming breakthrough technologies as next generation of iron and steel making technologies that reduce or
eliminate CO2 emissions and manufacturing of lighter steel for automobiles will also boost the growth of steel industry.
▪ Rising import levels hurting country's steel manufacturers.
▪ Volatility in raw material costs are making domestic production costly.
▪ General economic uncertainty due to country's tax reforms and spending cuts. (Though the best case scenario is a
slight improvement in steel demand in the US with a GDP growth of 2.5%, if Congress is unable to reach a
compromise on tax reforms, it could lead to market uncertainty and economic disruptions).
▪ New EPA (Environmental Protection Agency) rules are also going to have an effect on the steel sector - particularly
those supplying to the automotive industry. Vehicles will have to be lighter, and therefore there is the threat of
aluminum or plastic substitution.

7. US Steel Industry - Future Outlook
In future, growth in the United States will be supported by
strong momentum in the auto sector which is expected to
account around 27% share of steel consumption by the end
of 2017. Automobile production in US is growing at CAGR
of around 15% during 2010-12, exhibiting ample
opportunities for steel industry to grow.
In addition to that, recovery in construction sector is also
boosting the country's steel industry and expected to
account 42% share of total steel consumption in the
country.
Also, demand from US$ 235 Million worth Verrazano
Bridge project will boost the demand of steel orthotropic
decks in the country. MTA is going to spend US$ 201
Million on U.S. products and labor.
Additionally, demand for steel tubes to use for drills, well
casing, pipelines and other equipment will also rise on the
back of country's shale gas revolution. Companies such as
U.S. Steel and ArcelorMittal have been racing to develop
steel for the resurgent Detroit auto industry and pipes for
the shale gas revolution.
Oil and gas industry might be responsible for about a third
of expected 20% growth in the US steel market by 2020.
Even so, other uses such as construction and the car
industry are still very important.
Besides that, various companies such as Pro-Tec Coating
Co. and NanoSteel are working towards research and
development in the field of steel for making it lighter,
stronger, more easily formable steel to help automakers
meet the tougher fuel economy and safety standards which
will help the steel industry to grow further and to
overcome EPA norms' challenge.
Although country's US steel industry is growing
countinuously; huge global overcapacity, sluggish demand
in many sectors, and prices that have been falling steadily
since 2011, are still the major challenges in US Steel
Industry.

8. US Steel Industry - Key Players
▪ Nucor Corporation
▪ United States Steel Corporation
▪ Gerdau Ameristeel
▪ Commercial Metals Company
▪ Steel Dynamics, Inc.
▪ AK Steel Holding Corporation
▪ Arcelormittal Holdings Inc.
▪ Allegheny Technologies
In 2012, global production of crude steel hit a record 1.55 Billion Tons, up 1.2% from 2011. Even in the U.S., where the
manufacturing sector is not seeing its finest days, steel production led by mills run by U.S. Steel Corp. and Arcelor
Mittal in the Midwest, and Nucor Corp. in the South, rose 2.5% to 88.5 Million Tons last year. While all the three
companies faced revenue drop in 2012. Revenue of U.S. Steel Corp., Arcelor Mittal and Nucor Corp. declined by 2.8%,
10.38% and 2.97% respectively from 2011.

9. RNCOS is a leading business consultancy services company believes that in today's cut-throat environment, companies
need to understand their business environment better.
Critical questions that businesses need to address:
● What geographies to target?
● How to identify & increase the customer base?
● How to enhance the brand image?
● How to launch new products and find distributors?
● What is the current market structure and market size?
We understand your immediate needs and your long-term goals and objective and work with you on how to accomplish
them.
RNCOS blends the best of strategy consulting with the best of market research to provide organizations with accurate,
succinct answers to their most important business questions.
What is the market size
Structure of the market
Who are your buyers
Buyers’ buying behavior
Expectations from the product
Similar products in the market
Features, attributes & market share of
these products
Customer preferences
Price range of these products
Most suitable distributors and
channels for your business.
Analyzing their strength, credibility,
scale of operations.
Assisting in distributor selection.
Financial & strategic analysis of
existing competition
Acceptance level among customers
Emerging competitors
New market entrants
GROWTH PARTNER
We help you make informed decisions
through the practical application of research,
hand holding you to your success…

10. RNCOS is a business consultancy services firm that provides services to clients across the Globe. With more than a
decade of industry experience and expertise, we boast of a distinguished clientele' across multi geographies and industry
verticals. Our strength lies in the healthcare sector besides Retail and Information Technology.
Be it market testing, product launch, competition assessment, customer satisfaction study, pricing analysis or any other
requirement, RNCOS custom research team acts proactively to fit in the best possible solution for our valued clients.
We believe in multi-level client interaction and complete transparency from the project commencement till effective
implementation, thus ensuring total customer satisfaction at the end.
Having served close to 200 renowned as well as start-ups globally, our strength lies in multilingual and multi geography
tie-ups with leading market survey partners who assist us in gaining vital primary insight straight from the horse's
mouth.
Vartika Sehgal
Sr. Research Specialist
RNCOS
B-129, Sector - 6, Noida - 201301
Phone: + 91 (120) 4224700
Fax: +91 (120) 4224707
Email: marketing@rncos.com
Website: http://www.rncos.com
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