USS to build NGO line at Big River Steel

US Steel is affirming its commitment to the growing electric car market with the announcement that it is building a non-grain oriented (NGO) electrical steels line at Big River Steel

The line is projected to come online in September 2023 and is expected to have an annual production capacity of 200,000 tons.

According to an investor release on Tuesday, June 8, US Steel plans to “meet the growing electric vehicle demand with the best NGO capabilities” while funding the project “with cash generated from Big River Steel’s robust profitability and cash flow.”

Expected CAPEX for the project was put at $450 million, including $50 million in 2021, $325 million in 2022, and $75 million in 2023. US Steel posted adjusted net earnings of $283 million in Q1 2021, up from an adjusted net loss of $123 million in Q1 2020.

After the completion of the line, US Steel projects earnings before interest taxes depreciation and amortization will be $60 million in 2024, $120 million in 2025, and $140 million in 2026.

US Steel’s investment will put it among a small group of companies capable of producing NGO, and the company promised to deliver “unmatched NGO electrical steel characteristics compared to less capable domestic competition.”

Arkansas-based Big River Steel has planned to focus more on NGO steel since 2019, before it was purchased by US Steel.

US Steel is taking the next step as a “path to enhance its earnings profile” because of recent commitments by the US auto industry to increase the focus and production on electric vehicles.

By 2025, Ford plans to spend more than $30 billion on its electrified vehicles “in anticipation of 40% vehicle volume fully electric by 2030.” Toyota has said 40% of its new vehicle sales by 2025 should be electrified models and General Motors is aiming to produce 30 new global electric vehicles by 2025, according to the investor release.

US Steel said it has an advantage in NGO production because it will have the ability to produce “thinner gauges not widely available today” of 0.10-0.50 millimeters.

“By 2027, over 90% of NGO consumption is expected to be 0.25-0.50mm product,” the investor release said.

What to read next
Following a six-week consultation period, Fastmarkets can confirm it will amend the calculation method for all the average functions on the Fastmarkets platform from Wednesday March 1, 2023.
Consolidation, the recycling of electric vehicle batteries, US steel exports and the benefits of sustainable steelmaking were key talking points at Fastmarkets’ Scrap & Steel 2023 conference in Dallas in January
Green shoots of increased demand will emerge in US ferrous markets courtesy of the Biden administration’s trillion-dollar infrastructure package in 2023, Schnitzer’s executive vice president and chief strategy officer Richard Peach said at Fastmarkets’ Steel and Scrap Conference 2023 in Dallas, Texas
US special bar quality steel prices rose in January in line with rising scrap and alloy costs, according to market participants
European metal industry association Eurometaux has called on the European Commission to follow the lead shown by the Inflation Reduction Act and deliver a “powerful” policy to support the industry in the EU while it tries to keep up with the move to a new generation of energy markets
The fallout from Russia’s invasion of Ukraine is changing global trade flows for bauxite, with Brazilian material once again flowing into China and with the introduction of export restrictions elsewhere likely to influence availability through 2023
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
Proceed