Steel Industry Heats Up in ArkansasFebruary 10, 2022
Steel production is heating up in Arkansas.
In January 2022, Arkansas unveiled the biggest economic development deal by capital investment in the state’s history: U.S. Steel’s announcement that its “steel mill of the future” would be built in Osceola, Arkansas. This 6.3-million-ton mega mill will feature two electric arc furnaces with 3 million tons of annual steelmaking capability, along with a state-of-the-art endless casting and rolling line and finishing capabilities.
For U. S. Steel President and Chief Executive Officer David B. Burritt, Arkansas offered a prime location for its steel mill that will allow U.S. Steel to grow and meet the needs of its customers.
“With this location selected and shovels ready, we are reshaping the future of steelmaking,” he said. “We had numerous competitive site options, but Osceola offers our customers incomparable advantages.”
“The State of Arkansas, Mississippi County, the City of Osceola, Entergy, BNSF, and other parties have all worked to make this the clear choice for a path to the future without roadblocks. We’re not going to make our stakeholders wait to see progress. We intend to break ground this quarter and get to work as soon as permits are in hand. With its extraordinarily low-cost structure, energy efficient production equipment, and advanced capabilities, this $3 billion project will yield significant benefits to our customers, stockholders, communities, employees, and contribute to a more sustainable world.”
On February 8, 2022, U.S. Steel broke ground on the new facility, which is expected to bring 900 new jobs to the area.
“Last month, we announced that U. S. Steel would build a new state-of-the-art mill in Osceola,” Arkansas Governor Asa Hutchinson said. “We are excited to break ground on the project. Once it is finished, it will be the largest single project investment in the state’s history. This is a great opportunity for Arkansas, and I am thrilled to watch the impact this project will have on the northeast Arkansas economy as well as the families of the workers to be employed by the mill.”
The U.S. Steel announcement is only the latest major development in Arkansas’ steel industry. Northeast Arkansas has a thriving steel industry built around the infrastructure and strong workforce in the area.
In August 2021, Majestic Steel announced its plans to develop a new state-of-the-art service center and processing facility on the campus of Nucor Hickman in Blytheville. This 515,000-square-foot master distribution site was designed to better service Majestic Steel’s customers, due to Arkansas’ strategic location, and it provides the company with proximity to Nucor’s production.
Big River Steel has also made its mark on Arkansas’ steel industry and has brought new innovations to the industry. The company, now owned by U.S. Steel, broke ground on its Flex Mill in 2014 and started production in 2016. This Arkansas-based steel mill became the first steel production process to achieve LEED Certification, the most widely used green building rating system.
The story of steel in Arkansas starts with Nucor Corporation, which wanted to develop a steel mill on the Mississippi River, more than 30 years ago. Nucor Corporation now operates Nucor Steel and Nucor Yamato in Mississippi County, manufacturing automotive-grade steel products.
“A little company called Nucor Corporation decided they wanted to build a steel mill on the Mississippi River. Arkansas was a good home for that because they had the river system, the rail system, the highway system and a reliable electrical grid. What they had then, they have today only in spades,” former Big River Steel CEO David Stickler said.
Nucor expanded its facilities in 2016, investing $230 million in Arkansas and creating 100 new jobs.
“As a world leader in steel manufacturing technology, Nucor is particularly focused on increasing productivity and efficiency, and competing in global steel production. With today’s automakers counting on steel as their material of choice to reduce vehicle weight, while at the same time improving both safety and performance, our new cold mill will be at the forefront of making these advanced high-strength steel products,” said Jay Henderson, Nucor Steel general manager.
Companies such as U.S. Steel, Nucor and Big River Steel have chosen Northeast Arkansas as a base of operations for its attractive location on the Mississippi River, which provides a cost-effective method of transportation for products.
“Barges can deliver raw materials that are melted down to make steel and then they can put the product they make on another barge to ship up or down the Mississippi River,” Arkansas Secretary of Commerce Mike Preston said.
Companies also benefit from easy access to interstates in Arkansas, including I-40, which stretches from North Carolina to California; I-55, which connects eastern Arkansas to St. Louis and Chicago and New Orleans to the south; and I-30, which connects Arkansas to Texas and Mexico. Close rail access makes Arkansas an attractive location for steel companies with three Class I systems in the state, including Union Pacific, BNSF Railway, and Kansas City Southern Railway, along with 22 smaller railroads operating more than 2,700 miles of track.
Workforce is critical to the steel industry, and Arkansas’ workforce is second-to-none. As a right-to-work state, Arkansas can help steel companies reduce costs while still providing a talented workforce.
This workforce is sustained through Arkansas’ robust educational ecosystem. Arkansas has more than 40 institutions of higher learning, including technical colleges, that are generating a high-quality talent pool. In Northeast Arkansas, Arkansas Northeastern College is directly supporting the steel industry by offering a two-year Steel Tech program designed to prepare students for a steel industry career.
With its central location, robust infrastructure and strong workforce, Arkansas is well-positioned to support a growing steel industry. Steel companies have discovered the advantages of moving to or expanding in Arkansas, and the state is ready to help these companies grow.
For the steel industry, it’s clear: Arkansas is open for business.