Daehan Steel Co. Ltd., South Korea, awarded SMS group an order to modernize its existing VCC® (Vertical Compact Coiler) of the rolling mill in its Pyeongtaek plant, which is located in the Seoul area.
The plant produces 450,000 tons per year of compact coils in diameters from 10 to 25 millimeters which is internally processed in the own cut-and-bend facilities or exported to the Far East market.
The modernization project foresees the installation of a new welder at the furnace exit side of the existing rolling mill which will be used to join billets 130 x 130 millimeters or 150 x 150 millimeters to generate an endless feedstock that will be rolled on the existing mill to make a tailor-made coil weight of up to five tons.
The intermediate rolling mill line will be also modified with a relocation of the existing crop shear used for head stock cutting, while a new dividing shear will operate to define the coil weight by cutting endless bar. The modification of the existing water quenching / soft cooling line is foreseen as well to fulfill the requirements of the new process.
The existing VCC® system will be modified to handle the new coil weight of up to five tons by replacing the two coilers and some modifications at the coil handling located downstream. The VCC® line produces compact coils directly coiled in vertical position. Plant operators can therefore eliminate the need for turning manipulators and, at the same time, reduce the process cycle time as all coils are formed in the final position. The coils are ready to be stored immediately once coiling has been completed and the coils have cooled down. Reduced handling also minimizes the overall risk of damaging the coil surface.
SMS group, with deep knowledge of the existing plant, will minimize the modification at the existing equipment to reduce the shutdown time of the plant for the erection.
The main target of the modernization is the production of heavier coils which will reduce the downtimes in the cut-and-bend facilities leading to a reduction in production costs.
Daehan Steel places the second order in a row with SMS group, trusting in SMS group’s modernization expertise and strengthening the long-term partnership between both companies.
British-owned Liberty, part of Sanjeev Gupta’s global GFG Alliance, Friday 12th October, announced a conditional agreement to buy four European steel plants, employing more than 12,500 people; putting itself at the heart of the Continent’s steel industry and cementing its global role in the sector.
In a landmark transaction that would take Liberty’s total rolling capacity to over 15m tonnes a year, the Group has made a binding offer to buy ArcelorMittal’s major integrated works at Galati in Romania and Ostrava in the Czech Republic, along with rolling mills at Skopje in Macedonia and Piombino in Italy.
The deal is subject to approval by the European Commission and other local processes including the conclusion of information consultations with local and European Works Councils.
Adding these major steel hubs more than doubles Liberty’s global metal manufacturing capacity, which already includes a strong position in the UK as a steel and aluminium supplier to the automotive, aviation and specialist engineering sectors and in Australia supplying steel for building and infrastructure. The Group also makes steel in the USA for the automotive and other sectors.
The new European assets would boost Liberty’s capacity across a full range of flat and long products and pave the way for the Group to develop further its primary and GREENSTEEL sustainable production models in the Continent’s industrial heartlands.
Today’s announcement follows the recent roll-out of Liberty’s investment programme in France, where it has acquired the country’s last remaining aluminium wheel maker and agreed to purchase Europe’s largest aluminium smelter at Dunkerque; a deal expected to complete shortly.
Liberty secured preferred bidder status for the ArcelorMittal European plants against competition from other producers after the company put the profitable assets up for sale as part of an agreement with EU competition regulators to clear the way for it to purchase Italian steel giant, Ilva, Europe’s largest producer of flat carbon steel. Liberty has worked closely with ArcelorMittal to prepare a transaction that satisfies the demands of the EU Commission and creates a secure future for these businesses within the GFG Alliance.
Following completion, Liberty intends to continue investing in the assets – which already have many leading-edge facilities – and aims to achieve greater competitiveness through low-carbon production and closer integration with added-value downstream manufacturing, as part of its GREENSTEEL strategy.
In addition, Liberty and the wider GFG Group aims to develop close working relationships with respective governments, trade unions and other local stakeholders in order to optimise the value of the steel assets for the regional and national economies.
Executive chairman of the GFG Alliance, Sanjeev Gupta, said: “I am delighted to announce this landmark transaction, our biggest milestone to date. At a stroke these acquisitions would almost double the size of our workforce and global production capacity, giving us a strong presence in the heart of Europe’s key manufacturing regions. We intend to work with local partners to position ourselves strongly within the domestic supply chains of these fast-expanding national economies and become a pivotal part of a thriving European industrial sector. These are high-quality assets with highly-skilled staff whom we’re looking forward to welcoming into the GFG Alliance.”
The four sites in the package have a combined rolling capacity of around 8m tonnes a year and would give Liberty the ability to supply a full range of finished steels including; plate, hot rolled coil, cold rolled coil, galvanised sheet, tin plate, bar, wire rod, and rail. The plants serve domestic and wider European markets, including automotive, construction, industrial machinery and oil and gas sectors.
Jay Hambro; chief investment officer of the GFG Alliance said: “Following relevant approvals for this transaction, the GFG Alliance will have a number of new global hubs in Europe. These steel operations are high-performing, profitable assets with modern equipment, excellent transport connections to key markets and high-skilled workforces. There is huge potential for expansion, further modernisation and the application of GFG’s GREENSTEEL strategy.
“Following our entry to these countries as a steel producer, we look forward to working with partners to introduce other GFG businesses to these jurisdictions. We’re eager to explore opportunities for SIMEC’s infrastructure, resources and highly-successful renewable energy teams as well as our financial services team at Wyelands and real estate specialists in JAHAMA’s as part of a holistic GFG offer.”
Completing the general renovation of Blast Furnace A has brought the voestalpine Steel Division a further step towards increasing energy and resource efficiency at its steel production site in Linz. After a 111-day period for repairs, the furnace, in which two-thirds of the entire annual pig iron volume of five million tons is produced, today successfully restarted operations. At a total cost of around EUR 180 million, the so-called relining project involved completely replacing the extremely wear-resistant interior lining of the blast furnace, as well as modernizing all other facilities used in operating the blast furnace. At around the same time, interim repairs were carried out on one of the two blast furnaces in Leoben-Donawitz.
“The comprehensive upgrades to Blast Furnace A are important in safeguarding the future of the site in Linz, and that of its about 11,000 employees, for the coming decade. At the same time, the high technical standard of this blast furnace is also the basis for supplying our processing sites with high-quality steel grades.”
Wolfgang Eder, Chairman of the Management Board of voestalpine AG
The relining of the large blast furnace, originally built in 1977 and most recently extensively upgraded in 2004, was undertaken during the period from June to September 2018 and, in addition to replacing the refractory bricks, included the modernization of all peripheral plant and equipment such as the Cowper stove, gas supply, and dedusting systems. The focus also lay in installing new digital measuring and control instruments. By involving the customers at an early stage and consistently building up a stock of the relevant pre-material supplies, it was possible to deliver as usual during the repair phase.
Digitalization for greater resource efficiency
While modernizing Blast Furnace A we upgraded all the process steps to the state-of-the-art in order to achieve even better results in terms of resource conservation and material consumption. We are doing this by using completely new digital capabilities as well.
The applied technologies include 3D radar to determine the optimum distribution of raw materials and automated temperature measurements within the blast furnace. Around 160 employees in the core voestalpine team worked to prepare and realize this major project, while at the same time a total of 1,000 people were employed at the site for over a year. Special simulation software which mapped all the plant and equipment as well as process scenarios was used to plan the relining. In future this tool will also be used during ongoing operations at the blast furnace.
Interim repairs to the blast furnace in Leoben-Donawitz
Parallel to the major project in Linz, one of the two blast furnaces belonging to the Metal Engineering Division in Leoben-Donawitz also underwent interim repairs. After 64 workdays, the furnace, which is responsible for around half of the 1.5 million tons of annual pig iron production at the Styrian site, returned to normal operations this week. The costs for the repairs, which are routinely undertaken on each of the two furnaces at the site once every four years, amounted this time to the comparatively low sum of EUR 14 million.
The introduction, by the United States government, of quotas and tariffs, arising from their Section 232 investigations, reduced the flow of imported stainless steel into the country. Moreover, it enabled domestic producers to steadily lift their prices. As alloy surcharges rose, US mills also raised their basis figures, for grade 304 cold rolled coil, by US$200 per tonne, or 16 percent, between January and July 2018. This contributed to an increase of US$680 per tonne, or 28 percent, in transaction values, over the same period. Buyers, however, considered that this trend went too far. As alloy surcharges have softened, in the past two months, basis figures have also been reduced, resulting in a cut of US$265 per tonne, or 8.5 percent, in effective prices.
European mills, in contrast, were unable to supplement the rise in alloy surcharges with basis price hikes. Indeed, while alloy extras for austenitic coils climbed, during the first half of this year, basis values moved, steadily, in the opposite direction. In recent months, many market participants resorted to making deals using “effective prices,” as the difference between the alloy surcharge and the total transaction value ceased to represent a viable basis price.
The EU’s temporary safeguarding quotas were aimed at preventing material, previously destined for the United States, from being diverted into the European market. While the quota for stainless steel coils has, almost certainly, averted a glut of third country material, buyers believe that they will be able to secure all their requirements, between now and February 2019, within the allowed import tonnage.
Distributors of stainless steel bars, however, estimate that the quota for that product will be exhausted by December 2018. This demonstrates the upward trend in sourcing bars from overseas – notably, from India. Many buyers will now wait until the introduction of more permanent measures, before placing further import orders.
MEPS predicts that EU stainless steel prices will continue to decline, in the short term. Flat product transaction values fell, in September, mainly due to decreases in alloy surcharges.
EU Stainless Steel
Reductions in alloy surcharges have been announced, for October, and further cuts are expected in November. Many customers will, therefore, delay placing orders. EU stainless steel mills will attempt to limit the impact of the decrease in the cost of alloying extras on their effective selling prices, in the months ahead. However, this may prove difficult under current weak market conditions.
Orders on the EU stainless steel producers are expected to reduce due to excessive inventories in the market. Imports are likely to remain competitive, in the short term. The EC safeguarding quotas for flat products will, almost certainly, remain available at the start of 2019. Transaction values are forecast to rise in the first half of 2019, mainly as a result of increased raw material costs, at that time.
The September average cash nickel price decreased by approximately 6 percent, month-on-month. The ongoing trade war, between China and the US, continues to worry investors. A strengthening in the US dollar added to the negative pressure on nickel prices. Nevertheless, inventories held in LME warehouses fell to below 230,000 tonnes.
The fundamentals remain positive for nickel – with demand outstripping supply. Growing concerns about a slowdown in the Chinese economy are likely to restrict the potential for a significant upward movement in nickel values, in the short term. An upturn in prices is, however, envisaged, in the first half of 2019. A steady increase in nickel demand is anticipated, particularly from the electric vehicle sector. However, significant growth in consumption from that source is expected to take many years to develop. The downward trend in LME inventories is likely to continue in the medium term. This is forecast to have a positive influence on nickel and, subsequently, EU stainless steel prices, in the next twelve months.
Business sentiment is deteriorating, in Turkey. Domestic steelmakers pushed for price increases, this month, to offset the depreciation of the local currency against the US dollar. However, steel-consuming engineering and manufacturing firms are reluctant to increase production capacity in the absence of sustainable end-user demand. Sales to the construction sector is subdued.
Procurement activity in Brazil is lethargic. MEPS detects little evidence of an imminent upturn in end-user demand. New public works contracts are scarce. Bearish local traders stress that sales volumes are forecast to be stable, at best, in the short term. Consequently, they are unwilling to build inventories, at present.
Challenging trading conditions persist, in the Russian Federation. Local steelmakers indicated to their customers that further upward price adjustments are likely if input costs continue to rise. The situation is exacerbated by the weakness of the local currency. Several bearish trading houses are now destocking, using the current high transaction values, to boost profit margins.
The business environment is improving, in India, owing to the imminent end of the monsoon season. Nonetheless, buyers remark that the recent upward trend in domestic mill transaction values is unsustainable and does not reflect real demand. As the month progressed, the gap between domestic offers and bids made it difficult for any new transactions to be concluded. Traditionally, sales volumes begin to improve from mid-October onwards.
The trading climate remains challenging in Ukraine. Stockists are highly critical of the pricing strategies being employed by their flat product suppliers. Support from offshore buyers is restricted.
The trading environment remains challenging, in the United Arab Emirates. Local trading houses are in little hurry to replenish their stocks. They are uncertain about the future prospects for industrial activity and construction work, in October. Export opportunities remain limited outside the GCC region.
South African distributors are booking for only immediate requirements, citing deteriorating economic fundamentals. They contend that the latest price initiative undertaken by ArcelorMittal South Africa (AMSA), for October deliveries, would escalate import tonnages.
The prognosis for the Mexican market is unchanged. Domestic stockists are optimistic that trading volumes of finished long products will increase in November. Heavy rainfall slowed down construction activity, this month. Buyers contend that current price levels are unsustainable and that a correction is inevitable.