Steel Mills
ATI Q2 Losses Narrow as Strike Ends, Aerospace Improves
Written by Michael Cowden
August 3, 2021
Allegheny Technologies Inc. (ATI) continues to ramp up production at its hot rolling and processing facility (HRPF) in Brackenridge, Pa.
The increased output comes following the end of a lengthy strike by the United Steelworkers (USW) union and thanks to a long-term slab toll rolling agreement with JSW Steel USA.
“This multiyear agreement provides a meaningful opportunity to increase our asset utilization and cash flow. We’re happy to partner with JSW to bring the exceptional quality and gauge control of our world-class HRPF to their customers,” ATI Chairman, President and CEO Robert Wetherbee said during a conference call with analysts on Tuesday, Aug. 3.
ATI announced in May that it would roll carbon slabs from JSW Steel USA’s electric-arc furnace (EAF) mill in Ohio into hot-rolled coils under the terms of the tolling agreement.
Capacity utilization at the HRPF is approximately 30% at present. “But we see a line of sight to go to 50%. And then through 2022, we could even get up to 70%. So we’re pretty excited about what could come there,” Wetherbee said.
The pact is notable because ATI’s primary businesses focus on titanium, stainless and specialty steels as well as forgings and castings for high-end applications such as aerospace.
And aerospace markets are rebounding from the nosedive that followed the outbreak of the COVID-19 pandemic last year, company executives said.
“We’re seeing commercial aerospace recovery and … improving aerospace market conditions will create an outsized benefit for ATI,” Wetherbee said on the call.
All told, ATI’s losses narrowed to $49.2 million in the second quarter of 2021 following a $422.6 million loss in the second quarter of 2022. The USW strike, which lasted more than three months before concluding in July, cost the company $40.3 million in the second quarter, according to earnings data.
By Michael Cowden, Michael@SteelMarketUpdate.com
Michael Cowden
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