PITTSBURGH There is ample room for Big River Steel LCC in a U.S. market awash in imports and high-priced domestic steel, the companys chief executive officer John D. Correnti told AMM.
The United States currently imports roughly 20 million to 30 million tons of steel per year, which doesnt make sense in a country with low electricity costs, a strong domestic market and an ample supply of scrap, Correnti said.
"This is the place to melt and make steel," Correnti said. "So why is so much foreign steel coming in? ... Its either the steel mills in this country cannot make the quality or the price is too high. Thats it. All this crying about Dumping! Dumping! Unfairly traded steel! Its poppycock."
Efficient mills that make quality products shouldnt feel threatened by a new player, Correnti said. "But you can't (compete) with 20- to 60-year-old equipment," he said. "Youve got to invest in the newest tools and steel mill equipment not only from an environmental standpoint but also from a cost standpoint."
Big River Steel will focus much of its effort on the electrical steel market, where the company sees opportunities to take market share not only from a limited number of domestic suppliers but also from imports, Correnti said. "Im a capitalist. Its called survival of the fittest. And if you have a better mousetrap than somebody else, youre going to survive," he said, brushing aside concerns about potential domestic overcapacity.
The company expects solid demand from the transformer market as well as potentially strong future demand from the automotive market as electric motors become more common, Correnti said. "Its a good niche, a lucrative market and, unfortunately, one of these days well all be driving big golf carts," he quipped.
Correnti also swatted away questions about whether Big River Steel would be up against stiff competition from Charlotte, N.C.-based Nucor Corp., estimating that his company would have only minimal overlap with Nucor facilities in the area. "If you are a low-cost, efficient producer and you put out a quality product, you are going to survive," he said. "If youre not, you wontIve seen that for 40 years in the steel industry."
Big River Steels proposed $1.1-billion steel mill in Osceola, Ark., appears poised to move forward after Arkansas environmental officials upheld a decision to issue an air permit for the project. Nucor said it was disappointed with the decision and mulling its options, including a possible appeal. Nucor cited environmental concerns, while Correnti insisted the potential rival was concerned more about competition (amm.com, April 25).
Nucor operates facilities in northeast Arkansas, including Armorel, Ark.-based Nucor Steel-Arkansas and Blytheville, Ark.-based Nucor-Yamato Steel Co., both within 30 miles of Osceola.
Correnti, the former vice chairman, president and chief executive officer of Nucor, announced plans to build Big River Steel in January 2013 (amm.com, Jan. 29, 2013).
Big River Steel is expected to produce hot-rolled, cold-rolled, galvanized, and pickled and oil coiled products for the automotive sector; grain- and non-grain-oriented electrical steels for the electrical sector; and substrate for the pipe and tube sector.