Steel Mills

ThyssenKrupp Steel Americas Sale Negotiations Continue
Written by John Packard
September 8, 2013
ThyssenKrupp AG has told the media that reports of them not selling the Steel Americas assets and that they may keep the facilities are erroneous. Steel Market Update (SMU) understanding of the current negotiation process is CSN is the leading company in negotiations. The most recent development has CSN purchasing the steel mill in Calvert, Alabama operation only. Our sources are advising SMU the suggested purchase price is for a little more than $1.5 billion.
The issues for both ThyssenKrupp AG and CSN are the new buyer (CSN) is short slabs and would need to purchase them on the open market in order to operate the Alabama facility. CSN currently can produce approximately 5.2 million metric tons of slabs at their existing mill in Brazil. However, the Brazilian steel market has seen close to 20 percent in price increases this year and the total production at the CSN facility is dedicated to their domestic markets.
ThyssenKrupp AG wants to sell all of the Steel Americas facilities but, after the break down of the #2 blast furnace at the CSA facility in Brazil the amount of interest in the CSA facilities has waned with even CSN backing away from the TK slab mill. SMU has heard reports that the CSA plant could require between $800 million to $1 billion in repairs (prior to the #2 blast furnace going down – which is now back in operation).
At the same time you have minority partner Vale as an active seller of slabs into the international markets. Vale has a supply agreement to provide iron ore to the mill and does not want to increase its ownership.
Logic says the two sides (CSN and TK AG) are focused on the CSA asset and what can be done to minimize TK’s exposure and get CSN slabs for the Alabama mill. The ideal situation for TK is for CSN to buy the Brazilian plant. If that can’t happen – what is the next best result for TK?
TK has advised the market since they put the plants up for sale that their intention was to have them sold by the end of their fiscal year which is the end of September 2013.

John Packard
Read more from John PackardLatest in Steel Mills

U.S. Steel sues Algoma over iron pellet shipments
U.S. Steel is suing Algoma over the Canadian flat-rolled producer's rejection of iron pellet shipments, arguing it has breached its contract.

August US mill shipments slip but still higher than last year
The American Iron and Steel Institute reported a decline in the monthly shipments of US mills from July to August.

TransPod, Algoma, Supreme Steel linkup anchors Canadian steel in high-speed transit build
The three Canadian companies have announced a strategic partnership to support the development of an ultra-high-speed transit line from Edmonton to Calgary.

Metallus, USW agree to tentative four-year labor deal
Metallus and the United Steelworkers (USW) have agreed to a tentative four-year labor contract.

ArcelorMittal Dofasco resumes cokemaking after emergency maintenance
The Canadian steelmaker reported on Sept. 30 that “urgent maintenance” was needed in its coke plant off-gas systems. The work required coke oven gas from the No. 2 coke plant to be flared for most of that week.