An executive said Venezuela needs to seek a stronger integration among its state-owned companies operating in the iron and steel segments, as a way to strengthen these sectors in the Venezuelan domestic market.
Jesus Mata, president at Corporación Siderúrgica de Venezuela (CSV), a holding company that includes other government-owned producers, said such a pursuit will be present in all development plans conducted by CSV.
At the symposium that discussed the perspectives for the country’s iron and steel segments, the executive said Venezuela’s technical, human and financial capacity to consolidate new industrial projects is substantial, along with new mining ventures to supply the nation’s current and future domestic needs.
Mata suggested local iron ore producers should rethink the way they operate.
“We can’t think anymore in isolated plants operating by their own. The new Venezuelan iron and steel model will point out to a total integration, which covers the mining [operations] until the manufacturing of ferrous products for final use,” he said.
CSV’s companies include iron ore producer Ferrominera Orinoco, steel producer Sidor, HBI producers Briquetera del Orinoco and Briquetera del Caroni.
Mata said such integration could empower Venezuela’s steel production, as local producer Sidor, currently operates at nearly a fourth of its installed capacity.
The executive also mentioned the country’s need of reducing immediately and considerably the costs of reduction, while facilitating a commercial and a technological integration with the private transforming sector.
Venezuela has tried to stimulate in-company trade, and has opposed imports of several products, such as refractories from Brazil.
Recently, Venezuela’s state-run steelmaker Sidor, which is part of CSV, has signed a deal with HBI producer Comsigua for the supply of iron ore pellets. Sidor is expected to provide Comsigua 180,000/mt of iron ore pellets, which will be used by Comsigua to produce 132,000/mt of HBI. According to the government, the deal is expected to help Comsigua to reactive its HBI production lines. By doing so, the company will now be able export the product overseas while also supplying the material domestically.
At the same time it seeks for more in-company deals, Venezuela is also struggling to produce refractory materials to meet the demand of its domestic steel industry. Venezuela has been importing the product from Brazil in order to keep up the operations of state-run steel producer Sidor as well as the output of other segments, such as cement and aluminum, which also use the product.
Recently, in a meeting with several of the state-owned companies that comprise the Corporación Siderúrgica de Venezuela (CSV), leaders of refractories producer CVG Refractarios, along with steel producer Sidor and HBI producer Orinoco, discussed the country’s capacity to produce refractories to meet its domestic demand in a number of sectors, including the steel segment.
Since October 2014, CVG Refractarios hasn’t received enough feedstock to produce the product, according to recent media reports. CSV’s president, Jesús Zambrano Mata, said earlier this year a commission was working to substitute the imports, so the country could produce it domestically.