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Nucor mulling second DRI unit in La.: Ferriola

Jun 18, 2014 | 03:34 PM | Michael Cowden

Tags  Nucor, John J. Ferriola, new capacity, direct-reduced iron, DRI, Tenova HYL, Tenova, Midrex Technologies sheet

NEW YORK — Nucor Corp. does not plan to build a new sheet mill in the United States but may be weighing a second direct-reduced iron (DRI) unit in Louisiana as well as a new heat-treat line at its plate mill in Tuscaloosa, Ala., the company’s top executive suggested.

The Charlotte, N.C.-based steelmaker also continues to hold onto plans for a blast furnace in Louisiana, according to chairman, president and chief executive officer John J. Ferriola.

"It would be challenging for us at this time to say that we would be building a new steel mill, particularly a sheet steel mill," Ferriola said during a question-and-answer session following a keynote presentation June 18 at the Steel Success Strategies XXIX conference in New York sponsored by AMM and World Steel Dynamics Inc. "We don’t think that it’s necessary. We think the market is well balanced."

However, the situation is different with DRI, given that Nucor has already installed the necessary infrastructure for a second unit at its plant in St. James Parish, La., Ferriola said. "It would cost less money and it would be quicker to put a second DRI facility in Louisiana."

A second unit likely would cost $100 million to $150 million less than the first unit, Ferriola said, estimating that it would take about 18 to 24 months from the date the project was announced until it was completed.

Nucor broke ground on the $750-million St. James Parish plant in 2011 (, March 7, 2011) and made its first shipment of DRI from the 2.5-million-ton-per-year facility late last year (, Dec. 31).

Nucor also might consider Charlotte-based Midrex Technologies Inc. for its second unit even though it went with Tenova HYL, a subsidiary of Milan-based Tenova SpA, for its first unit, Ferriola said. "We would take a hard look at which way we would go for the second unit. Just because the first unit happens to be HYL does not necessitate the second unit being an HYL unit."

The St. James Parish site has already been permitted for a blast furnace (, Sept. 15, 2010), Ferriola noted, adding that the company still has engineering work for the potential project. "When you look at the drops that have occurred in the past six months on the price of coking coal, it’s been phenomenal. So we haven’t shredded the drawings for the blast furnace just yet. We have it on the shelf."

Nucor also has the in-house expertise to operate a blast furnace, Ferriola said. "So if we decide to go that way, we’ve got the technology, the drawings and we have the people."

Another project that might be in the works is a new heat-treat line at its Tuscaloosa plate mill, Ferriola hinted.

Nucor was said to be considering changes to its mill in Tuscaloosa, including the addition of a heat-treat process, according to documents filed with state officials (, May 28). "We’re looking at some opportunities that we can’t talk about at this time, but we wanted to be prepared for them, so we filed the air permits," Ferriola said.

Nucor added a heat-treat line, a normalizing line and vacuum tank degasser at its mill in Hertford County, N.C., Ferriola noted. "When we started up the heat-treat line, we were sold out within a matter of 30 days."

The combination of heat-treat and normalizing capabilities saw orders come even faster, Ferriola said, allowing Nucor to provide value-added products and more common grades. "People buying heat-treat and more commodity grades would be coming to us and saying, ‘Do them both. Fill a load out.’ It’s worked out very well for us, so we are certainly taking a look at whether we should be doing that at our other facility."

Nucor’s Hertford County plate mill started operating the new 120,000-ton-per-year normalizing line in June 2013, raising the facility’s value-added plate product capacity to 240,000 tons per year (, July 19).

Nucor is working through the numbers and conducting economic and marketing analysis of expanding Tuscaloosa, Ferriola said. He declined to provide a specific time line for the potential project but noted that historically the company has moved quickly.

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