Australia based BlueScope Steel Ltd. says it is considering expanding its North Star Steel mill, located in Delta, Ohio, thanks to what it labels a promising outlook for the North American steel sector. The steel mill is an electric arc furnace (EAF) operation with an annual capacity of 2.1 million tons per year of hot-rolled coil steel.
In an appendix to its most recent financial report, BlueScope said, “A comprehensive study has been initiated to evaluate adding between 600,000 to 900,000 metric tons per annum of steelmaking capacity [in Ohio], through the addition of a third electric arc furnace and a second caster.”
The steelmaker has given the project an initial estimated price tag of from $500 million to $700 million, and adds, “The project is expected to take two or three years to develop if we proceed.” BlueScope adds it expects to provide an update on the project assessment in about one year.
In BlueScope’s 2018 fiscal year, which ended June 30, the company says its North American mill generated 13 percent more sales revenue compared to the previous fiscal year and while the mill’s “underlaying EBITDA (earnings before interest, tax, depreciation and amortization)” increased by 7.5 percent compared to the year before.
The steelmaker says it sells approximately 90 percent of its Ohio mill output in the Midwest, with its end customers consisting of “broadly 50 percent automotive, 35 percent construction, 5 percent agricultural and 10 percent manufacturing/industrial applications.” The firm adds that the North Star mill “continues to benefit from strength in the automotive sector as well as in the construction sector.”
In terms of its scrap feedstock, Waterloo, Indiana based MetalX Inc. has been investing in a large scrap yard in Delta, Ohio, across the road from the BlueScope mill.
At the November 2017 groundbreaking for that $35 million facility, MetalX president and chief executive officer Danny Rifkin remarked of his company’s investment, “We truly appreciate the encouragement of the North Star BlueScope team,” as well as citing support from Ohio economic development officials. The new MetalX yard is scheduled to begin operations after October 1 of this year.
Published in the October 2018 Edition
