USA Electric Arc Furnace Market Outlook to 2030

USA Electric Arc Furnace Market Overview

• The USA Electric Arc Furnace (EAF) market is growing by the increasing demand for steel production. The global electric arc furnace market size was valued at USD 729.78 million in 2023. The market is being affected by the rising demand for steel produced through more sustainable and energy-efficient methods. The shift towards using scrap steel as a primary raw material for steel production is propelling market growth.
• The key players in the USA EAF market are Nucor Corporation, Commercial Metals Company (CMC), Steel Dynamics Inc., Gerdau S.A., ArcelorMittal. These companies dominate the market due to their extensive production capacities, technological advancements, and strategic investments in sustainability.
• In 2023, Nucor Corporation announced the opening of a new EAF facility in Kentucky, expected to produce over 2 million tons of steel annually. This $1.7 billion investment aligns with Nucor's strategy to increase its production capacity and meet the growing demand for sustainable steel solutions.
• The Northern region of the USA, particularly states like Ohio, Pennsylvania, and Michigan, has a well-established industrial infrastructure. This region is the hub for the automotive and machinery industries, which demand high-quality steel products produced through EAF technology.

USA Electric Arc Furnace Market Segmentation

The USA electric arc furnace market can be segmented by various factors like product type, end-user and region.

By Product Type: The USA electric arc furnace market is segmented into product types in long steel, flat steel and others. In 2023, Rebars which comes in long steel is dominate due to their extensive use in construction and infrastructure projects.

By End-User: The USA electric arc furnace market is segmented into end-user in construction, automotive and manufacturing. In 2023, Commercial construction projects drive demand for long steel products, particularly rebars.

By Region: The USA electric arc furnace market is segmented into regions in north, east, west and south. In 2023, The Northern region leads due to its advanced industrial infrastructure, high steel demand from automotive and machinery industries, and significant investments in EAF technology.

USA Electric Arc Furnace Market Competitive Landscape

• Steel Dynamics' AI Integration: In 2022, Steel Dynamics Inc. announced the development of an AI-integrated EAF system, improving production efficiency and reducing operational costs. This innovative system uses AI algorithms to optimize the EAF process, resulting in an increase in productivity and a reduction in energy consumption. The implementation of AI technology demonstrates Steel Dynamics' commitment to leveraging cutting-edge technologies for operational excellence.
• Gerdau S.A.'s Acquisition of SCR Recycling: Gerdau S.A. completed the acquisition of SCR Recycling, a major scrap processing company, in December 2022 for $500 million. This acquisition aims to secure a steady supply of raw materials and improve the effic iency of its EAF operations. By integrating scrap processing facilities, Gerdau ensures a consistent and reliable source of recycled steel, which is essential for its EAF operations.
• Commercial Metals Company (CMC) Facility Expansion: In 2023, CMC announced a $300 million investment to expand its EAF facility in Arizona. The expansion is expected to increase the plant's annual production capacity by 500,000 tons. This investment will incorporate the latest in energy-efficient technologies and aims to meet the growing demand for sustainably produced steel.

USA Electric Arc Furnace Market Analysis

USA Electric Arc Furnace Market Growth Drivers

• Green Steel Production: In 2024, several major steel producers in the US committed to achieving carbon neutrality by 2050. EAFs, which produce steel with significantly lower carbon emissions compared to traditional methods, are at the forefront of this trend. This shift towards green steel is expected to drive investments in renewable energy sources and advanced carbon capture technologies.
• Automation and AI Integration: In 2024, EAF facilities in the US adopted AI-driven systems to optimize production processes. These technologies enhance operational efficiency, reduce downtime, and improve product quality by providing real-time data analytics and predictive maintenance capabilities. The trend towards increased automation is expected to continue, driving further advancements in EAF technology.
• Tax Incentives Introduction: The US government introduced tax incentives for companies adopting sustainable steel production methods, promoting the use of EAF technology. These incentives include tax credits for renewable energy use and investments in carbon capture technologies. In 2024, it was reported that companies utilizing these incentives could reduce their tax liabilities, encouraging further investments in sustainable practices.

USA Electric Arc Furnace Market Challenges

• Raw Material Price Volatility: The volatility in the prices of raw materials, particularly scrap steel, poses a significant challenge for the EAF market. In 2024, the US scrap steel prices fluctuated between $300 and $450 per ton, impacting the profitability of EAF operations. These price fluctuations can result in increased production costs and reduced margins, making it challenging for companies to maintain stable and predictable operations.
• High Initial Capital Investment: Establishing EAF facilities requires substantial capital investment, posing a significant challenge for market growth. In 2024, the cost of setting up a modern EAF facility was estimated to range from $500 million to $1 billion, depending on the capacity and technology used. This high initial cost can be a barrier for new entrants and smaller companies, limiting the market's expansion potential.

USA Electric Arc Furnace Market Government Initiatives

• Infrastructure Investment and Jobs Act: The Infrastructure Investment and Jobs Act allocated $1.2 trillion for infrastructure projects, driving demand for construction materials, including EAF steel. In 2024, this act boosted the construction sector, with an increase in infrastructure projects. The increased demand for steel from these projects supports the growth of the EAF market, as EAF-produced steel is preferred for its lower environmental impact.
• Advanced Manufacturing Partnership: In 2023, the Advanced Manufacturing Partnership launched, aims to support innovation and technological advancements in the manufacturing sector, including steel production. This initiative provides funding and resources for R&D projects focused on developing advanced EAF technologies. In 2024, the partnership funded over 50 projects, totaling $300 million, aimed at improving energy efficiency and reducing carbon emissions in EAF operations.

USA Electric Arc Furnace Market Future Outlook

The USA electric arc furnace is poised for significant growth over the next five years, driven by increasing demand for steel production, technological advancements, and rising in the construction sector.

USA Electric Arc Furnace Future Market Trends

• Expansion of Production Capacities: Major players in the EAF market are expanding their production capacities to meet the growing steel demand. In 2024, Nucor Corporation announced plans to invest USD 1.5 billion in expanding its EAF facilities, aiming to increase its annual production capacity by 1.5 million tons.
• Strategic Partnerships and Collaborations: The EAF market is witnessing an increase in strategic partnerships and collaborations aimed at driving innovation and improving sustainability. In 2024, Commercial Metals Company (CMC) partnered with a leading technology provider to develop an advanced EAF system with enhanced energy efficiency and reduced carbon emissions.