During Steel Dynamics Inc.’s quarterly financial report, the company issued an update on the progress of the company’s new EAF flat roll mill in Sinton, Texas.
SDI is currently hot-commissioning the value-added paint line, and according to quotes from Mark D. Millett, Chairman and Chief Executive Officer, the company expects the galvanizing line to be operational next month.
However, due to the excessive heavy rains in Texas, actual steel production will be delayed and is now planned to start mid fourth quarter 2021, Millett said. Based on current plans, the company expects shipments from Sinton could be in the range of 100,000 tons during the remainder of 2021 and between 2.2 million tons to 2.4 million tons in 2022. Based on mid-cycle flat roll metal spreads, SDI currently expects through-cycle annual EBITDA for our Sinton Texas Flat Roll Steel Mill once fully operational with access to four value-added coating lines (estimated to be 2023) is likely in the range of $475 million to $525 million.
According to Millett, SDI also plans to invest approximately $450 million to $500 million in four additional value-added flat roll steel coating lines comprised of two paint lines and two galvanizing lines with Galvalume coating capability, “a set of which will be located in the Southern US to provide Sinton with the same diversification and higher-margin product capabilities as our two existing flat roll steel divisions,” Millett said.
The other two lines will be located in the Midwest, “to support growing coated flat roll steel demand and to further increase the diversification and cash generation capacity of our existing Midwest operations.”
Based on current estimates, the company expects these four lines will likely begin operating sometime in the second half of 2022.