Steel Mills

Indiana Harbor Aluminizing Line Closed

February 25, 2016

ArcelorMittal USA has closed the aluminizing line at Indiana Harbor West. Workers have been transferred to a galvanizing line that restarted after being idled near the end of 2014.

The closing has been in the works for more than a year and was actually expected in December. ArcelorMittal has been in talks with the USW about closing additional lines at Indiana Harbor. The plan is to run fewer lines and investing in others to preserve jobs and improve efficiency according to USW District 7 Director Mike Millsap.

The action comes as part of a strategy that will move more production to the AM/NS Calvert plant in Alabama which is continuing to ramp up production after meeting some headwinds on slab costs last year.

In the Q4 earnings report, ArcelorMittal reported Calvert is expected to increase volumes and EBITDA this year. The facility is geared toward servicing the automotive industry and has been approved so far on more than 200 automotive qualification packages. AM/NS Calvert will produce high value steels including Usibor, an aluminum-silicon coated high strength steel and Ductibor, an energy-absorbing high strength steel grade designed specifically to complement Usibor.

“ArcelorMittal is considering all options to optimize our assets in the United States and beyond, including those within Indiana Harbor, in support of the Action 2020 program that was launched at our Q4 and full-year 2015 earnings announcement,” said spokesperson Mary Beth Holdford in an email.

“Action 2020 is a strategic roadmap that aims to achieve targeted financial improvements for the company by 2020. In the United States, efforts to support Action 2020 include asset and cost optimization as well as an improved portfolio of high added value (HAV) products. These products will ensure ArcelorMittal is uniquely positioned with a strong technical and product portfolio to serve customer requirements.”

The following chart is from the Q4 earnings report and illustrates the strategy ArcelorMittal will follow in the Action 2020 plan. Approximately $3 billion in structural and operational improvements are planned across all of ArcelorMittal’s business sectors from 2016 through 2020. The plan is incremental and sets as a goal 90 million tonnes of shipments by the end of 2020.

Optimization of assets in the U.S. are expected to be accomplished without layoffs by leveraging natural attrition, said Holdford.