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US a prime spot for pellet plants, Vale says

Jun 18, 2014 | 05:52 PM |

Tags  Vale, José Carlos Martins, direct-reduced iron, pellet plant, Voestalpine, Nucor, U.S. Steel, International Metallics North Star BlueScope Steel

NEW YORK — The United States could be a prime location to build pellet plants for iron ore producers given low natural gas prices and assuming domestic direct-reduced iron (DRI) production keeps ramping up, according to a top Vale SA executive.

"We would consider building a pellet plant in the United States," particularly if DRI facilities start being constructed further inland, José Carlos Martins, executive director of ferrous and strategy for the Rio de Janeiro, Brazil-based resources company, said in response to an audience question at the Steel Success Strategies XXIX conference in New York, sponsored by AMM and World Steel Dynamics Inc., Englewood Cliffs, N.J.

Low natural gas prices are spurring DRI use.

Charlotte, N.C.-based Nucor Corp. started up its 2.5-million-ton-per-year facility in St. James Parish, La., late last year (, Dec. 31) and Austria’s Voestalpine Group has invested in a 2-million-tonne-per-year hot-briquetted iron (HBI) and DRI facility in Corpus Christi, Texas (, April 23).

International Metallics Corp. (IMC) is also reportedly considering an $800-million, 2.5-million-ton-per-year DRI facility plant in Superior, Wis. (, Jan. 22), while U.S. Steel Corp., Pittsburgh, is studying a joint effort for DRI production with Canton, Ohio-based Republic Steel Co. (, May 1).

North Star BlueScope Steel LLC is also said to be considering a DRI venture (, May 27).

Responding to an audience question, Martins said a favorable gas price for DRI production is around $4 per million British thermal units.

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