US Steel changes course and will keep processing raw steel at Granite City plant in Illinois

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HARRISBURG, Pa. (AP) — U.S. Steel reversed course and said Friday that it will continue processing raw steel at its Granite City Works plant in Illinois, nixing a decision that had put the plant on track to stop work in the coming weeks.

U.S. Steel did not explain its reasons for changing course, now barely three months after Nippon Steel sealed a deal with President Donald Trump to buy the iconic American steelmaker by giving the government a say over decisions that affect domestic steel production.

In a brief statement, a U.S. Steel spokesperson said it will continue to supply raw steel slabs to Granite City “indefinitely.”

Initially, it had said ending processing operations at Granite City would allow U.S. Steel to “maintain future flexibility.” On Friday, it said “our goal was to maintain flexibility, and we are pleased to have found a solution to continue slab consumption at Granite City.”

It did not say what that solution was.

The United Steelworkers union — which had opposed the buyout by Nippon Steel — accused U.S. Steel of trying to “wiggle out” of commitments that Nippon Steel made in its deal with the White House.

“But we wouldn’t let it,” the union said in a statement. “We pushed back on USS’s flimsy excuse that it couldn’t supply slabs to Granite City for us to process. We reached out to political leaders to remind them that this was the very situation we foretold.”

It also had planned a rally, it said, “to show management that we don’t go away without a fight – and we never will.”

U.S. Steel responded that it is in full compliance with Nippon Steel’s agreement with the White House.

U.S. Steel had said that, even though it was going to end processing work at Granite City, it wouldn't lay off any of the roughly 800 workers there or reduce their pay, at least until 2027, when protections expire for Granite City in Nippon Steel's agreement with the White House.

Granite City Works makes rolls of sheet steel for the construction, container, pipe and automotive industries.

The plant is located in southern Illinois, just outside St. Louis. However, in 2023, U.S. Steel stopped producing raw steel there when it idled the last operating blast furnace at Granite City. It idled the other blast furnace there in 2019.

It has similar processing plants at its Mon Valley Works facilities in Pennsylvania and Gary Works in Indiana.

The pursuit by Nippon Steel for the Pittsburgh-based company was buffeted by national security concerns, dragging out the transaction for more than a year after U.S. Steel shareholders approved it.

In the end, Trump changed his stance on invoking national security grounds to block it after Nippon Steel upped its guarantees of investment into U.S. Steel facilities and added a so-called “golden share” provision that gives the federal government a say in certain decisions.

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Follow Marc Levy on X at: https://x.com/timelywriter