PITTSBURGH Metal recyclers selling into the Alabama market will enjoy increased demand and a shift in the type of scrap consumed when U.S. Steel Corp. converts to electric-arc furnace (EF) steelmaking.
The Pittsburgh-based steelmaker announced plans to replace the blast furnace at its Fairfield (Ala.) Works with an EF-based melt shop, which is expected to sport an annual raw steel production capacity of about 1.1 million net tons (amm.com, Jan. 29).
Fairfield consumes about 28,000 tons of primarily shredded, plate and structural, heavy melting scrap and bundles per month, market sources told AMM. The shift to EF steelmaking, which is expected to be completed by 2017, will increase Fairfields scrap purchasing to an estimated 60,000 to 80,000 tons per month.
"This area consumes 500,000 tons of scrap each month, so a 10-percent increase is a nice amount," one Birmingham, Ala., scrapyard operator said.
The new melt shop will be making steel for rounds, which will require more premium grades such as busheling and will also increase the quantity and quality of shredded scrap it purchases, a shredder source in the area said.
"Since the shred is not being fed into a basic oxygen furnace, it will have to be a better quality," the Birmingham scrapyard operator said.
A local shredder said that about 20,000 tons of the projected monthly increase could be for shredded scrap. "That is a significant increase in shred demand for one area," he said.
Since Fairfield will be producing rounds instead of sheet, the market will lose a significant amount of slitter scrap generated in its flat-rolled production, the local shredder operator noted. "Foundries use this grade (slitter) and will have to start to look more toward busheling to fill this void," he said.
Changes will be needed at Fairfields offloading section in its rail scrapyard, several sources said. The steelmaker currently is restricted by height and can only receive low-side rail cars, which hold less tonnage.
"They will need to get their rail offloading situation better or scrap will be too expensive," the local shredder operator said.