Housing Starts Support U.S. Steel Production Growth

different kinds of steel barsU.S. steel production will continue to increase in the coming months partly because of import tariffs, while more building permits from the housing sector will also support the sustained demand.

Despite some concerns over higher prices for locally made products, using high-quality steel sheets for sale may still be a good choice since demand for houses remains stable.

Outlook on Production

The newly imposed tariffs seemed to have encouraged more steelmakers to lift their forecast growth in volume. Some companies cited a stronger demand as one reason for the growth. Industry figures also aligned with the expected increase if the trend continues in the coming months.

World Steel Association’s data showed that steel production in the country reached almost seven million tons in June, while the American Iron and Steel Institute said that the production registered at 1.78 million tons in the week ending June 30.

Housing Starts

The growth in housing starts in July would also be an economic indicator for steel demand. Since construction is among the biggest users of the material, steelmakers will likely ramp up production. Home builders are also making calculated risks in response to a rebounding housing sector even if construction prices are trending upward.

Single-family housing permits rose almost 2% as of July, which was the largest growth since October 2017 based on U.S. Commerce Department data. Employment and salary growth are driving the increase not only in the standalone housing market but also in the apartment sector.

The cost of buying steel may be more expensive now that the government imposed new tariffs, but home builders are willing to pay the price to meet the growing demand for residential properties. If the trend continues, it may be sustainable to keep using steel for construction projects.