US Steel to resume steel production at Illinois plant shut 2 years ago

U.S. Steel announced Thursday it will resume steel slab production at its Granite City Works plant in Illinois as demand rebounds, reversing course on previous plans to scale back operations at the facility.

The Pittsburgh-based steel giant will reopen a blast furnace it idled two years ago during United Auto Workers strikes, citing increased customer demand as the primary driver behind the decision. The company expects to resume steel production in the first half of 2025 after completing necessary hiring and equipment preparations.

“After several months of carefully analyzing customer demand, we made the decision to restart a blast furnace,” said CEO David Burritt in a statement. “Steel remains a highly competitive and highly cyclical industry, but we are confident in our ability to safely and profitably operate the mill to meet 2026 demand.”

This announcement marks a significant reversal from U.S. Steel’s previous stance on Granite City Works. The company shut down the last blast furnace at the facility in 2023 and had announced plans to wind down its steel processing mill there as recently as September. However, the company changed course on the processing mill after facing pressure from the Biden administration.

The revival of steel production at Granite City Works will require significant staffing efforts. U.S. Steel will need to hire 400 of the 500 workers necessary to operate the plant, according to company representatives. These positions will be crucial for getting the blast furnace operational and maintaining production capacity.

Industry analysts note this development comes amid improving conditions in the American steel sector. The American Iron and Steel Institute reported that domestic steel mills shipped 7.7 million net tons in October, representing a 9 percent increase compared to the same month last year. Year-to-date shipments through October were up 5 percent over the same period in 2023.

The resurgence in steel demand has been attributed to several factors, including protective tariffs implemented under both the Trump and Biden administrations. Rebounding activity in the automotive manufacturing and construction sectors has also bolstered demand for steel products.

Granite City Works specifically produces rolls of sheet steel for various industries, including construction, container manufacturing, pipe production, and automotive manufacturing. Its strategic location in Southern Illinois, just across the Mississippi River from St. Louis, positions it well for distribution throughout the Midwest.

The decision to restart blast furnace operations at Granite City comes at a pivotal moment in U.S. Steel’s corporate history. Less than six months ago, Japan-based Nippon Steel finalized a $14.9 billion acquisition of the iconic American steelmaker after reaching an agreement with the Trump administration to address national security concerns.

As part of that agreement, Nippon Steel committed to giving the federal government input on certain company decisions involving domestic steel production, including those related to closing or idling U.S. Steel’s plants. The Japanese firm also pledged to invest approximately $14 billion in American steel production, including the construction of a new electric furnace.

Under the national security agreement, protections for Granite City Works will expire in 2027, while other U.S. Steel facilities remain protected until 2035. This timeline may have factored into the company’s decision-making process regarding the Illinois plant’s future.

The reopening of blast furnace capacity at Granite City Works stands out in an industry that has seen dramatic consolidation over recent decades. Currently, only 12 blast furnaces operate in the United States, according to the American Iron and Steel Institute. This represents a dramatic decline from approximately 140 blast furnaces operating in the 1970s, before foreign competition significantly disrupted the American steel industry. No new blast furnaces have opened in the United States in decades, making U.S. Steel’s decision to restart existing capacity particularly notable.