SDI execs tout progress on Mississippi biocarbon facility

First announced in 2022, the project is a joint venture with renewable biocarbon producer Aymium, based in Gwinn, Mich.

“The team plans to continue to refine operations and increase production into the first quarter of next year,” Wagler added. “This achievement marks a pivotal step in our decarbonization journey and further demonstrates our ability to translate innovative concepts into tangible results.”

The facility’s initial production capacity is expected to be 228,000 metric tons (mt) per year, with an estimated capital investment of ~$300 million, according to a slide presentation accompanying the call.

SDI estimates the facility will reduce its Scope 1 greenhouse-gas emissions by as much as 35%.

The company also believes Aymium’s process can “provide a renewable fossil fuel carbon alternative for Iron Dynamics, our proprietary iron-making operation,” the slide presentation stated.  

The biocarbon, made from woody biomass, will be a renewable replacement for anthracite.

From a cost-structure perspective, Wagler said, “It really probably won’t have a material impact for you to be able to observe from the outside in.”

She added, “It is a joint venture. So we are transacting as we would at a market price to our steel mills.”

However, Wagler emphasized the venture “does offer an opportunity for us to offer an even lower carbon product.”

She said SDI is already seeing some customers who are providing premiums. It’s “not something that we’re talking about at this point more broadly in specifics, but we think it will open the door for even more opportunity on market share, specifically in OEMs, specifically more in the flat-rolled side of the business.”

Wagler added that they should be operating continuously starting in November. “So it will take a minute before we’re supplying as much into the steel mills as we’d like.”

Chairman and CEO Mark Millett was also upbeat on the project.

“We’re extremely excited to have this new tool in our decarbonization journey that will further reduce our carbon footprint from an already industry-leading low level,” he said on the call.