Severstal North America, a division of the Russian steel producer Severstal, announced on February 25 its intention to resume the modernization programs at its Michigan-based Severstal Dearborn and Mississippi-based Severstal Columbus facilities amid improving steel market conditions. The projects were put on hold in the wake of an unprecedented fall in steel demand and pricing in the fourth quarter of 2008.
"While we remain cautious about the market outlook, we are encouraged that the more positive trends we saw towards the end of last year are being sustained. These projects are critical to furthering Severstal North America's leadership position in the production of innovative, high-quality light flat rolled products and strengthening our commitment to the North American steel market," Severstal North America CEO Sergei Kuznetsov said.
Accordingly, work will resume at Severstal Dearborn's coupled pickle line and tandem cold rolling mill (PLTCM) and hot dip coating line (HDCL) for the production of automotive exposed hot dip galvanized and galvanneal coatings. The PLTCM will allow Severstal North America to meet the highest quality needs of the automotive industry as well as other end-user markets, and to expand its product range. As a result, the Dearborn facility will increase its total output of cold rolled sheet from 1.65 million mt to 2.1 million mt per year. At the conclusion of this project, Severstal North America will operate three of the seven combined pickling/tandem mills that exist in North America.
On the other hand, works will also be resumed at Severstal Columbus to complete its Phase II project, which will increase the plant's crude steel capacity to 3.4 million mt, matching Columbus' hot strip mill capacity and allowing the plant to achieve greater economies of scale. In addition, Phase II will increase the capacity of Severstal Columbus' downstream operations by about 30 to 120 percent depending on the unit, including a continuous pickling line, batch annealing, temper mill and continuous galvanizing line. The expansion will further increase Severstal Columbus' participation in the growing industrial markets in the southern US and in Mexico. Products from Severstal Columbus are purchased primarily by the distributor, automotive, construction and pipe and tube end markets.
The project includes a second electric arc furnace complex with a ladle metallurgy facility, vacuum degasser expansion, a second thin strip caster, a second shuttle-type tunnel furnace, and a second downcoiler at the hot mill. The finishing side expansion will feature the addition of a fourth pickle tank to the existing continuous pickle line/tandem mill, additional hydrogen batch annealing bases and furnaces, a push/pull pickle line and a second galvanizing line.
The Dearborn and Columbus projects are expected be completed in the second half of 2011 and in 2012 depending on the commissioning schedules of the respective units. The financial details of the projects have not been disclosed.