Woods, who turned in only his seventh complete competitive round since the Masters, missed a 3-foot birdie putt, double bogeyed the par-5 12th hole in a pouring rain, shot a 2-over 73 and finished in a tie for 84th place. He wound up six shots behind Steele, who shot a 67 and was tied for the first-round lead with Garrett Willis, Briny Baird and Matt Bettencourt.
Steele won the Texas Open this year in his 12th PGA Tour start.
Woods has missed much of the 2011 campaign with knee and ankle problems while falling all the way to No. 51 in the world rankings. His most recent attempt at a comeback ended with a missed cut at the PGA Championship two months ago.
He chose this late-season event to try to regain his competitive edge leading up to the Australian Open and Presidents Cup matches in Melbourne next month.
"I hit some bad shots, but I hit some good shots," said Woods, who played two holes on the back nine of the CordeValle Golf Club course during the heaviest of the day's showers. "I missed some putts that kept me from gaining momentum."
Cantlay, a sophomore at UCLA, was paired with Woods and bested him by four shots. He was the low amateur at this year's U.S. Open and shot a 60 the following week at the TPC-River Highlands course in Connecticut -- the lowest score ever recorded by an amateur on the tour. He held the 36-hole lead at that event before fading on the weekend.