Nucor Prepares to Start Up New Galvanizing Line at Alabama Steel Mill

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Researched by Industrial Info Resources (Sugar Land, Texas)-- Nucor Corporation (NYSE:NUE) (Charlotte, North Carolina) is in the final phases of a $169 million project to construct and install a 500,000-ton-per-year hot-dip galvanizing line at its Trinity-Decatur Flat Rolled Steel Mini-mill in Alabama. Nucor acquired the mill from Trico Steel Company LLC, a subsidiary of the former LTV Steel Company, in 2002. In the new galvanizing facility, steel will be dipped in melted zinc. Zinc coating protects the steel from corrosion and rust. The galvanized sheet metal will be produced in sizes up to 72 inches wide. That's 7 inches wider than most conventional widths, giving Nucor more flexibility in product range and marketing. The galvanized metal isn't only used in the automotive market but can be used in appliances, heating and air conditioning units. See related January 9, 2007, article - Nucor Starts 2007 with a Bang - Moves Forward with Capital Projects and Acquisitions in North America.

Lots of time and money are needed to get a project of this magnitude off the drawing board, into the construction stage and finally into production. The company announced the project in June 2006. There are already more than 600 people employed by Nucor Decatur, and the project will add about 100 more. What does it take to undertake such a production? Hot dip tanks and rinse tanks, miles of conveyors, control systems, monitors and lest we forget hundreds of contractors are needed to see this project through to completion. Among the many subcontractors on site is TMEIC GE (Salem, Virginia), which was selected to supply new automation and electrical equipment for the project. The hot dip line was awarded to SMS-Demag AG (Dusseldorf, Germany) through a previous contract with Drever International S.A. that is now part of the SMS Group since being acquired in 2006.

The project is expected to be completed in June 2008 if all goes as planned. The company hasn't encountered any major setbacks or delays since the project's kick-off a year ago.

This wasn't the only project that Nucor had planned for this facility. The company had looked at a $20 million plan to a new vacuum degasser unit to the existing caster area sometime this year. But, that project has been put on hold for the time being. Another major expense is the ongoing cost of maintenance that a plant this size incurs on a yearly basis. The cost can run into the millions. With both scheduled maintenance shutdowns planned and minor monthly shutdowns to contend with, the budget has been set at about $7 million.

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