U.S. Steel reverses course, will continue processing raw steel at Granite City
Company says it will supply raw steel slabs to Granite City indefinitely, as labor groups and the Nippon Steel deal draw scrutiny over federal oversight and commitments.
U.S. Steel said Friday it will continue processing raw steel at Granite City Works in Granite City, Illinois, reversing an earlier plan to end processing at the facility in the coming weeks. The move comes less than three months after Nippon Steel sealed a deal to buy U.S. Steel and to secure government involvement in some decisions affecting domestic production. A U.S. Steel spokesperson said the company will continue supplying raw steel slabs to Granite City indefinitely. The company had previously said ending processing would help maintain future flexibility, but did not disclose the solution that enabled the reversal.
United Steelworkers, which opposed Nippon Steel's buyout, criticized the change, saying the decision appeared to back away from commitments made in the White House-backed agreement with Nippon Steel. The union said it planned a rally and would push back on management. U.S. Steel said it remains in full compliance with Nippon Steel's agreement with the White House and stressed that about 800 Granite City workers would not be laid off or have pay reduced through 2027, when protections expire under Nippon Steel's arrangement. Granite City Works continues to produce rolls of sheet steel used in construction, containers, pipes and automotive components.
Granite City, a site in southern Illinois near St. Louis, has a long history in U.S. Steel's production chain. The plant last produced raw steel in 2023 after idling the last operating blast furnace there; the other blast furnace at Granite City was idled in 2019. U.S. Steel operates similar processing facilities at Mon Valley Works in Pennsylvania and Gary Works in Indiana. Nippon Steel's bid for U.S. Steel drew scrutiny for national security concerns and regulatory review, extending well beyond a typical merger. The deal moved forward after shareholders approved it, and President Donald Trump ultimately supported the arrangement after Nippon Steel pledged increased investment in U.S. Steel facilities and added a government mechanism sometimes described as a golden share that gives the federal government a say in certain decisions.
Analysts described Friday's reversal as easing a potential disruption for Granite City in the near term, while keeping the broader deal and its safeguards in effect. The decision underscores how the company must balance capacity, labor commitments, and regulatory oversight in a volatile market for steel. For Granite City, the outcome preserves employment in the near term and maintains the plant’s role in supplying rolled steel to multiple industries, even as U.S. Steel continues to assess its network of operations under Nippon Steel's ownership and the White House-mandated protections that accompany the sale.