The Bureau of Industry and Security of the US Department of Commerce said in a November 18 report that if AK Steel stops producing grain oriented electrical steel, a key material used in transformer manufacturing, it could be viewed as a national security threat.
American company AK Steel - a subsidiary of Cleveland-Cliffs, the largest flat steel manufacturer in North America - may stop producing textured electrical steel due to unprofitableness, the Bureau of Industry and Security said in a report.
They noted that although AK Steel remains the leader in the domestic market, its production of electrical steel has proven unprofitable, in part due to years of pressure from cheaper imports.
In the event of a production shutdown, the United States will be completely dependent on foreign sources of materials critical to the production of transformers.
“There is insufficient or no production capacity in the country for certain grades of electrical steel, which are becoming more and more in demand to meet the efficiency standards of distribution transformers,” it said.
“There is not enough capacity in the United States to manufacture transformer cores and plates, which are key components of transformers. Transformer manufacturers in the United States rely on foreign sources (especially in Canada and Mexico), with more than 75% of the demand for critical components being met through imports, ”the report said.
