U.S. Steel Mill Project Activity Remains Strong with $4.4 Billion in the Works

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Following a turn-around year for steel manufacturing profitability in 2004 and continued rising steel end-product demand due in part to increased residential, commercial, and industrial construction, the U.S. steel industry is developing a significant number of capital projects to improve efficiency, expand capacity, and increase raw material supply.

Currently, Industrialinfo.com is tracking 110 capital and maintenance projects at U.S. steel mills totaling about $4.4 billion in total investment value (TIV) scheduled to begin construction in August of 2005 and beyond.

Around 23% of the planned spending will occur in Ohio, which has fourteen projects totaling about $1 billion. The second largest state for steel industry spending will be Mississippi with $730 million. This is mainly due to the SeverCorr LLC (Birmingham, Alabama) project, which is scheduled to begin construction in September 2005, once financing is finalized.

Click on the image at right to view a chart showing the breakdown of spending by state.

The SeverCorr project, the largest steel mill project on the books, is a $725 million grassroot steel mill planned in Columbus, Mississippi. (See June 24, 2005 news article for background information - SteelCorr Awaits Financing to Proceed with Mississippi Steel Mill)

Formerly developed under the SteelCorr LLC name, the SeverCorr name change reflects significant financing assistance from Severstal (Cherepovets, Russia). Financing for this project from Severstal and the German government and is scheduled to be finalized in early September.

Severstal has made several moves in the U.S. steel industry lately, starting with the acquisition of the Dearborn Steel Works of Rouge Steel in early 2004 and followed by an joint venture coke making agreement with Wheeling Pittsburgh, which will lead to a major upgrading of Wheeling’s Follansbee coke making operations. The company plans to spend close to $500 million at its North American steel industry operations.

Check out Industrialinfo.com's 2005 Steel Industry Wall Map by click on the image at right.

View Project Report - 03002599

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