York, Pennsylvania-based Magnesita Refratários S.A, a global refractory minerals provider, announced Wednesday that long-products steelmaker Gerdau Ameristeel has awarded Magnesita a contract to manage all refractory needs for Gerdau's Sayreville, New Jersey Electric Arc Furnace (EAF) rebar mill. The five-year cost per performance (CPP) contract has an estimated value of $4.5 million annually, and is the ninth CPP contract of its kind to be awarded by Gerdau to Magnesita in North America.
Under the terms of the contract, Magnesita will supply 100 percent of the refractory needs for the EAF, steel ladles, and continuous casting operations at Gerdau's Sayreville facility through Magnesita's unique CPP contract model. Through this model, Magnesita will provide high-grade products and manage the entire refractory process, utilizing its focused business model and deep production knowledge to support improvements in Gerdau's manufacturing processes.
"We are very pleased to be continuing our longstanding partnership with Gerdau Ameristeel, the second largest mini-mill steel producer, and steel recycler in North America, through this award," said James Piraino, Chief Operating Officer, North America. "Together we will work to reduce the controllable costs of steelmaking at Gerdau's Sayreville facility, improving overall productivity by optimizing refractory usage, equipment utilization, and energy consumption. We look forward to leveraging conversion efficiency and refractory application through the Magnesita CPP model to better position Gerdau for an increasingly competitive industry."