Market Data
May 25, 2021
Brazil's Usiminas Postpones Upgrades to Blast Furnace No. 3
Written by David Schollaert
Usinas Siderurgicas de Minas Gerais (Usiminas) has delayed planned upgrades to its blast furnace No. 3 (BF3) by 10 months. This is the second postponement to work on BF3 by the Brazilian steelmaker since originally confirming the planned investments in mid-2019. Due the ongoing impact of COVID-19 on the Brazilian marketplace, in specific the automotive sector, and the “stable operational performance” of Ipatinga’s BF3, the company said it has now postponed the upgrades to mid-2023.
Usiminas, one of the largest flat steel producers in Latin America with an annual capacity of 9.5 million metric tons, originally announced in May of 2019 that it would invest R$1.23 billion ($306 million) to overhaul BF3. Initially planned to operate normally until 2021, the largest of Ipatinga’s furnaces with an annual capacity of nearly 2.5 million metric tons would then be idled to undergo the planned upgrades. In late-2019, the company postponed the project by 12 months due largely to the depreciation of the Brazilian currency. The latest postponement will push the commencement of BF3’s refurbishment project into mid-2022. Additionally, the company noted that cost of the expected improvements to BF3 have been revised to R$2.09 billion ($392 million) due to significant exchange devaluation and increased materials cost. Usiminas did not immediately respond or offer comment.
