NEW YORK ArcelorMittal
SAs wire rod mill in Georgetown, S.C., continues to run
on two shifts instead of its usual three as the company
attempts to control costs after a slow winter.
The mill has been
running below capacity since the company laid off 30
employees in the fourth quarter of 2012, in part due to
competition from imports (
amm.com, Nov. 5). Wire rod demand began to weaken
at around the same time, sources said.
The Luxembourg-based steelmaker
plans to maintain a two-crew operation in the short term, a
company spokeswoman told AMM. However, it could
increase production if the market picks up.
"While there have been
indications of market improvement, we are carefully monitoring
the situation on a quarter-by-quarter basis," the spokeswoman
"The market is soft, and they
dont want to produce material for nothing," a market
Some sources said that they
expected the mill to move back to three shifts when the market
picked up in the spring, but the company hasnt announced
plans to return to normal production. Whats more,
Charlotte, N.C.-based Nucor Corp.s facility in
Darlington, S.C., is slated to begin producing wire rod in the
third quarter this year, which could create further competition
in the southeastern market.
"Mills should be running three
shifts going into the spring," a steel trader said, adding that
"having Nucor moving into (ArcelorMittals) backyard is
going to make life more difficult."
Despite the layoffs, the two
crews are working a full 96 hours a week instead of the 40
hours per shift that one crew usually works, a domestic
non-mill source said.
"Theyre running the crews
96 hours a week, and theyre actually producing some
pretty good results," the source said. "Theyre doing all
the right things."
The Georgetown facility is
unlikely to return to three shifts unless there were "a
guarantee that Chinese imports are not going to come in," a
second market source familiar with the situation said, adding
that the reduction to two shifts "makes a big difference in
facility makes high-carbon, low-carbon and alloy wire rod and
has the capacity to produce 750,000 tons per year, according to
the 2012 Association for Iron and Steel Technology