Steelmaking group Ternium expects to double HDG and galvannealed steel sheet output in Mexico through Teginal, the JV it has with Nippon Steel & Sumitomo Metal Corporation (NSSMC), the company said this week while releasing its Q1 results.
According to Ternium, the expected increase in capacity aims to serve the local industrial and automotive markets.
“Ternium and NSSMC have agreed that, once completed the facility and technical studies, Tenigal will build a second HDG line with yearly production capacity of 430,000 mt,” the company said.
The new facility will be located in Ternium’s industrial center in Pesqueria and is expected to start up production in 2019.
As a result, Tenigal's production capacity should reach 830,000 mt/year at a cost of approximately $300 million, Ternium said, adding the local automotive industry is among “the fastest growing automotive industries in the world.”
Ternium’s net sales in Q1 in Mexico declined 20 percent, year-on-year, to $990 million. The company’s net sales in the southern region, which manages businesses in Argentina, Paraguay, Brazil, Chile, Bolivia and Uruguay, diminished 27 percent in Q1, year-on-year, to $464.1 million. The company’s net sales in the other markets segment, which includes businesses mainly in the US, Colombia, Guatemala, Costa Rica, El Salvador, Nicaragua, Panama and Honduras, diminished 19 percent in Q1, year-on-year, to $196 million.
Ternium’s combined net sales for Q1 at its steel segment was $1.6 billion, 22 percent down, year-on-year.
Steel shipments in Mexico rose 4 percent in Q1, year-on-year, to nearly 1.6 million mt, but declined 10 percent in the same basis of comparison to 559,000 mt in the southern region segment. As for the other markets segment, steel shipments rose 1 percent in Q1, year-on-year, to 274,800 mt.