The total tonnage for the week ending March 31st was 1,776 million tons, (Mt) at a capacity utilization rate of 76.2%. For the first 13 weeks of 2018, total tonnage output was 22,838 Mt, at an average capacity utilization rate of 75.4%. In 2017, the same 13 weeks production total was 22,551 Mt at 73.2%. Thus volume is up 1.3% year on year, (y/y), while capacity utilization was sharply higher, up 2.2 percentage points.
Figure 1 shows production on the left-hand scale and capacity utilization as a percent on the right-hand scale. Capacity utilization and production tapered off at the end of the year as is typical for November and December. January got off to a slower start than in 2017, however production has since ramped up nicely since then, achieving levels not seen since 2014.
Figure 2 presents a map of the U.S. with its five steel producing zones. The nation as a whole produced 1.3% more steel than for the same period in 2017. The Great Lakes region was the largest steel producing region, with 8.519 Mt through March 31st, down 2.1% y/y. The Southern region habitually the second largest, produced 8.522 Mt up 6.4% y/y. At 2.751 Mt, the Northeast region ranked third largest, up by 1.2% y/y. The Midwest produced 2.124 Mt, down 1.6% y/y, while the Western zone produced 0.922Mt, down 5.2% y/y.
Looking at raw steel production on a twelve month moving total, (12MMT) basis, we see that; The Great Lakes region produced 34,044 Mt, up 2.0% y/y. The Southern zone made 33,252 Mt, up 10.8% y/y. The Northeast region produced 10,765 Mt for a 4.0% increase y/y. The Midwest generated 8,540 Mt, down 1.2% y/y. The Western region produced 3,792 Mt, 1.0% lower on a y/y basis. Total U.S. production, (12MMT) was 90,393 Mt, up 5.1% y/y.
At Gerdau, we track US steel production and capacity utilization to keep an eye on the overall health of the US steel industry. We feel it is important to understand the forces that influence steel demand to include the strength of the US economy and import penetration.