The U.S. steel industry is feeling the sting from the United Auto Workers' strike against Detroit's Big Three automakers.
Demand for steel has been falling for months in anticipation of the strike that is now in its third week, sending prices tumbling.
The Wall Street Journal reported the price for coiled sheet steel has plummeted 40% since April, and companies are pulling back on production.
The United States Steel Corp. temporarily shut down a furnace at its Granite City, Illinois, plant last month due to the strike, laying off more than 200 workers. If the strike is prolonged, more shutdowns could follow.
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The ongoing UAW strike is the first time the union has launched a simultaneous strike against Ford, General Motors and Stellantis, but so far it has been limited in its scope, targeting only certain plants.
Currently, around 25,000 of the 150,000 UAW members employed by the Big Three are on strike, but the union has not ruled out expanding the strike nationwide if talks drag on.
GM said Thursday that the strike has cost the automaker around $200 million so far, and the company confirmed it secured a $6 billion line of credit the day before. Ford and Stellantis declined to provide estimates of losses when asked by FOX Business.
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The longer the strike lasts, the more damage it will do to automakers and reverberate to other industries, particularly suppliers, which are already taking a direct hit.
Data from Michigan economic consulting firm Anderson Economic Group show the UAW's strike against the Big Three cost the U.S. economy $3.95 billion in its first two weeks.
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Previous UAW strikes have also led to significant declines in steel prices, according to Metal Miner. The outlet reported that during the union's month-long strike against GM in 2019, the price of hot-rolled carbon steel (HRC) fell nearly 16%, and the price of cold-rolled coil (CRC) dropped by almost 10%.
