Steelmakers grow US operations, capacity post-Section 232

Fastmarkets AMM reviews five international steel companies that have grown or developed their facilities in the United States following the Section 232 import tariffs - 25% in the case of steel from most countries - announced one year ago.

Acquisitions
Liberty Steel USA, a subsidiary of London-based GFG Alliance, has expanded its US presence with the $320-million buy of Keystone Consolidated Industries (KCI) and its subsidiaries.

Dallas-based KCI's assets include a wire rod facility with an electric-arc (EAF) furnace, a bar mill, three welded wire reinforcement mesh facilities and a pre-stressed concrete strand facility.

And Liberty Steel is considering expanding crude steel capacity at its KCI wire rod mill in Peoria, Illinois, by 300,000 tons per year. While crude steel capacity at that mill totals 800,000 tpy, Liberty Steel is “already examining” permit proposals that could raise that to 1.1 million tpy, the company announced in mid-January.

Fastmarkets AMM’s assessment of US industrial-quality low-carbon wire rod stands at $38.25-40 per hundredweight, down by 2.8% from $39.25-41.25 per cwt, where that price held from late May 2018 to mid-February 2019. Still, the price is up by 18.6% from $32-34 per cwt one year ago.

Meanwhile, Austrian company Welser Profile GmbH acquired Superior Roll Forming last June. Valley City, Ohio-based Superior features 24 roll forming lines, six in-line radio frequency welding lines, in-line laser welding and spot welding, and can produce spindle sizes from 1-4 inches, strip widths up to 48 inches, thickness up to 0.25 inches, and lengths up to 60 feet, according to its website.

The company supplies roll-formed shapes - including channels, angles and joists, among others - to the aerospace, automotive and construction industries.

Updates and expansions
JSW Steel (USA), a subsidiary of India’s JSW Steel, began making steel at its Ohio flat-rolled mill’s electric-arc furnace last December. The company had agreed to buy the EAF facility, located in Mingo Junction, for $80.85 million in March 2018.

The Mingo Junction mill has a 1.5-million-ton-per-year capacity EAF, but a hot-strip mill capable of producing 3 million tons per year, the company noted. And JSW Steel USA is considering a potential direct-reduced iron facility, in addition to further downstream capabilities - including pickling capabilities and a cold-mill.

Fastmarkets’ US hot-rolled index was calculated at $35.16 per hundredweight ($703.20 per short ton) on March 1. The index had climbed to a near-decade high of $45.84 per cwt in July 2018, but has since fallen 12.2% below the $40.03 per cwt level seen one year ago.

JSW Steel intends to produce 100% US-melted and -manufactured steel in coming years, according to chief executive officer John Hritz.

And Australia’s largest steelmaker, Bluescope, plans to add 800,000-900,000 tonnes per year of sheet capacity at its US subsidiary, North Star BlueScope, located in Delta, Ohio. 

The company also plans to add a third EAF and a second caster that will boost melt capacity by 1.4 million tonnes at the Ohio mill.

New developments
Luxembourg-based Tenaris has a new seamless mill in Bay City, Texas, which may achieve an annualized production rate of 450,000 tons later this year.

Fastmarkets AMM's pricing assessment for US domestic seamless high-collapse P110 casing stands at $1,420-1,470 per ton fob mill. That price reached a high of $1,750-1,8000 per ton in late April 2018, but has since fallen a slight 0.3% below the $1,400-1,500 per ton level seen one year ago.

Tenaris has plans to continue to invest in training and is "researching the application of digital automation and machine learning technology" at the Texas oil country tubular goods mill, which began production in 2017 and has a potential capacity of 600,000 tons per year.

Elizabeth Ramanand

elizabeth.ramanand@fastmarkets.com

Published

Elizabeth Ramanand

March 04, 2019

20:22 GMT