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JSW aims for US upgrades amid steel headwinds

  • : Metals
  • 20/04/28

JSW Steel USA is forging ahead with upgrades to its US operations even as the US steel industry reels from Covid-19-related shutdowns in industries like automotive and a downturn in the energy industry,

The US subsidiary of Indian steelmaker JSW Steel is making moves to upgrade its steel operations in Ohio, where it has an electric arc furnace (EAF) flat-rolled steel operation, and Texas, where it makes plate and pipe products for the energy industry, chief executive John Hritz told Argus last week

The downturn in the steel market has hit JSW Steel USA like it has many other steelmakers. The company's EAF at Mingo Junction, Ohio, has begun a four-week outage, and its pipe mill is set to take its own outage next month.

Hritz said in an interview that the four-week outage at Mingo Junction will allow the company to add all new automation, a first step to fully replacing the mill's aging furnace.

Hritz said the Ohio EAF has been operating at 50pc of its 1.5mn metric ton (t)/yr capacity to conduct preventative maintenance and because of reduced demand levels, and that it will be able to return to those levels after the outage. A full replacement of the EAF is expected to be completed by the beginning of 2021 and, in combination with other investments, it will be able to produce 12-inch slabs that will be supplied to the company's pipe and plate mill in Baytown, Texas.

Eventually, Hritz wants to build a second 1.5mn t/yr EAF at the Mingo Junction site, taking advantage of the rolling mill's 3mn t/yr capacity.

Since January, the Argus ex-works Midwest assessment for HRC has fallen by 24pc to $470.75/st. At the same time capacity utilization rates, which had been hovering around 80pc rates, have fallen to 55.8pc on the pandemic-related slowdown, the lowest rate in a decade.

The Mingo Junction mill has had a checkered history, with JSW becoming the sixth owner in 12 years when it acquired the idled mill for $81mn in early 2018. The EAF had been idled for nearly 10 years when it restarted melting operations in late-2018 amid a Section 232 tariff-fueled run-up in the domestic steel market.

Parent company JSW's figures show Mingo Junction only produced 241,600t of steel through 31 December, which marked the end of the first three quarters of its fiscal year 2020.

In Baytown, just outside of Houston, business at JSW Steel USA's pipe mill has slowed as many pipeline projects have been shelved following the crash in US crude prices.

"We're just waiting for ... the energy companies to get the courage to stand up," Hritz said. "Notwithstanding the price of oil, which is going to come back, they still need to put these pipelines in."

For now, the oil market is in the middle of a historic swoon.

The US oil benchmark WTI saw May futures trade in the negative range on the last day of trading this week. June futures were at $16.94/bl on 24 April, down by 72pc from the $61.18/bl WTI futures prices posted at the beginning of the year.

The US drilling rig count fell by 64 to 465 last week, its lowest since August 2016. Of the total, oil rigs fell by 60 to 378, according to Baker Hughes data released last week.

With the plunge in the market, US producer Continental Resources said that the ongoing Covid-19 pandemic has brought about conditions under which the force majeure clause applies. Most supply contracts include provisions for declaring a force majeure, which allows the parties to unwind some of their responsibilities based on actions or events outside of a company's control.

The downturn in oil prices has had immediate impacts on energy-related steelmakers. Integrated steelmaker US Steel and pipe maker Tenaris have idled multiple mills. Pipemaker Vallourec laid off 900 of its North American workers in early April, representing a third of its workforce in the region.

JSW's Baytown mill is expected to run until mid-May, after which it will be idled for upgrades. The company has already completed and begun commissioning the first phase of its $260mn upgrades to the pipe mill, which involved installing a new descaler, hot plate leveler, and giant shears that can cut up to two-inch thick steel.

The second phase will include upgrades like a new rolling mill, upgraded cooling technology, and a cold plate leveler.

A planned EAF at Baytown was shelved in August, with Hritz at the time citing market conditions and unfavorable trade policy from the Trump Administration.

The trade dispute is one that has brought Hritz, a strong supporter of the Section 232 steel tariffs imposed by President Donald Trump in March 2018, at odds with the administration. The company filed a lawsuit in 2019 against the Department of Commerce's process in denying JSW's applications for steel tariff exemptions, which were opposed by multiple US steel companies who said they could provide the slabs JSW requires. Hritz said the company is moving through the litigation process.

"It was wrong," Hritz said of the Commerce Department's decision to deny the exemptions. "We told the truth, and others did not."

While the lawsuit drags on Hritz is looking forward to the upgrades to the Baytown mill, which he believes will revamp the aging mill will allow it to better compete with newer pipe mills like Tenaris' 600,000 t/yr seamless pipe mill in Bay City, Texas, which started production in 2017. The Baytown mill has been operating at 29pc utilization rates in the quarter ending 31 December, according to JSW. Hritz blamed the mill's old equipment, which the upgrades are gradually replacing.

"When we're done with this plate mill it'll be over 1mn t/yr," Hritz said. "What we're putting in is not just a replacement, it's also something where the volume will increase dramatically, the throughput will be fabulous, and the quality will be untouchable."


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25/02/11

Mexican steel faces few outlets in wake of US tariffs

Mexican steel faces few outlets in wake of US tariffs

Houston, 11 February (Argus) — Mexican steelmakers, facing sluggish domestic demand, could struggle to find outlets for production after the elimination of US steel tariff exemptions. US president Donald Trump on Monday revoked all exemptions from the 25pc steel import tariff, effective 12 March. Canada and Mexico as part of the US-Mexico-Canada Agreement (USMCA) were exempt from Section 232 25pc steel tariffs announced in 2018, along with Argentina, Australia, Brazil, the EU, Japan, South Korea and the UK. The renewed 25pc tariffs also include "derivative steel articles" — downstream and value-added products. Mexico also faces the potential imposition of a 25pc all-goods tariff in March by the Trump administration. Originally meant to be imposed on 1 February, the tariff was delayed by 30 days on 4 February. Should the tariff — which only included Mexico and Canada — be imposed at the end of the postponement, US buyers could face a 50pc tariff on Mexican steel. More Mexico capacity looms The gap left by the imminent exit of the US as a free trade partner leaves Mexican steelmakers with few obvious outlets as a slew of incoming capacity expansions are poised to bloat domestic inventories. Mexico produced 18.2mn metric tonnes (t) of steel in 2024 , down from 19.85mn t in 2023 as steelmakers pulled back production to counter weak demand, according to Mexican steel association Canacero. Mexico exported 3mn t of steel in 2024 — 2.3mn t of which went to the US, according to Canacero. That was followed by Canada, which imported just 118,000t in 2024, and Saudi Arabia, which imported 90,000t. Still, Mexican mills are expected to add more than 5mn t/yr of additional steel production by the first half of 2026. About half of that will come from steelmaker Ternium's slab mill in Pesquería, Nuevo León, which is expected in the first half of 2026. The Ternium slab mill's location in northern Mexico was meant to help supply steel to the USMCA region . Some in the market more recently told Argus that the new tariffs would have very little effect on Pesquería's strategy — positing that the slab produced there could be exported to Ternium's facilities in Brazil. Still, Mexico only exported 27,000t of steel to Brazil in 2023 and it was not listed as a top-10 export partner in 2024. Long steelmaker Deacero in 2023 also announced a $1bn expansion over three years to grow production by 1.2mn t/yr. Deacero's expansion, too, was aimed at meeting expected nearshoring-driven demand in the medium and long term. In 2023, long steelmaker Simec announced a new 500,000t/yr rebar mill and Brazilian steelmaker Gerdau in May announced it was exploring sites for a 600,000t/yr special steel mill in Mexico. Slow demand adds further pressure In the absence of overseas demand for steel, Mexican steelmakers could have to look to a shaky domestic market to offload production. Federally funded infrastructure projects like the Tren Maya, the Olmeca Refinery in Tabasco and the Felipe Ángeles airport near Mexico City either wound down or concluded by 2024. The projects took with them a boon in steel demand and production that faded further as buyers were reluctant to commit to tons before the general elections in June 2024. That demand has yet to recover. Mexican president Claudia Sheinbaum, who took office in October, campaigned partly on the construction of 1mn homes — which would require an uptick in rebar consumption. Sheinbaum is expected to announce her full infrastructure plan on 17 February. The market has few other options for Mexican-produced steel should the government not adopt publicly funded steel-consuming projects as the country faces expectations of slower economic growth this year. Nearshoring efforts, including plans for domestic production of electric vehicles (EVs) from both Chinese EV makers and US automaker Tesla, have stagnated. A wider count of new foreign direct investments in Mexico shrank last year to the lowest level since 2014 . Sheinbaum on Monday confirmed that the Mexican government learned of the steel tariffs from media outlets. Any previously discussed retaliatory measures would come after a clarification of the tariffs, Sheinbaum added. By Marialuisa Rincon Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Trump steel tariffs end exclusions, expand scope


25/02/11
25/02/11

Trump steel tariffs end exclusions, expand scope

Houston, 11 February (Argus) — The US' planned extension of 25pc import tariffs on steel set to go into effect on 12 March will wipe out existing import quotas, exclusions and agreements established during the first administration of President Donald Trump, essentially resetting the playing field for US steel imports. The proclamation signed by Trump on 10 February said the tariffs are intended to increase US steel capacity utilization to 80pc and close loopholes in the existing tariff scheme that have led to increased imports. This would mean certain products that had been excluded from past tariffs, including those not currently made domestically, would no longer be able to be exempted once existing exclusion orders expire or volume quotas are reached, whichever happens first. Trump's latest tariff push will also target a broader swath of downstream steel products, while setting up a dedicated process for US producers and industry groups to request products be subject to the 25pc tariff. The US will determine whether or not to include the product within 60 days of the request. The Trump proclamation cited increased imports of steel derivative products, such as fabricated structural steel and pre-stressed concrete strand, as signs of countries evading the existing tariff, which was implemented under Section 232 of the Trade Expansion Act. Market participants widely expected the reinforcement of the 25pc import tariff for steel. But many initially downplayed the possibility for the import tariff rate to increase to 50pc for Canada and Mexico, which would be the case if the US moves forward with proposed blanket 25pc duties for those two countries next month. Trump first imposed Section 232 national security tariffs of 10pc on aluminum and 25pc on steel imports in March 2018. Since then the tariffs have been partially rolled back on certain countries, while importers were allowed to ask for product-specific exclusions. Currently Australia and Canada can export any steel and aluminum they want to into the US without tariffs, while Mexico can export steel melted and poured in the US-Mexico-Canada (USMCA) agreement region into the US without tariffs, while any material with an origin outside of USMCA is subject to 25pc tariffs. Steel tariff rate quota (TRQ) systems were in place for Argentina, Brazil, the EU, Japan, South Korea and the UK for steel products, with specifics dependent on the country. Steel imports are heavily reliant on the nontariffed countries, with their volumes making up 80pc of the 26.2mn metric tonnes (t) of steel products imported in 2024, according to US Department of Commerce data. By Blake Hurtik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexican auto exports slow in January


25/02/11
25/02/11

Mexican auto exports slow in January

Mexico City, 11 February (Argus) — Mexico's light vehicle exports fell by 14pc in January from a year earlier as uncertainty over US trade policy raises questions over prospects for exports going forward. Automakers in Mexico shipped 219,414 units in January, with 84pc bound for the US, according to statistics agency Inegi data. January exports declined by 17pc from December. Meanwhile, production edged up by 2pc to 312,257 units in January from a year earlier, while domestic sales rose by 6pc to 119,811 vehicles. Still, domestic sales dropped by 18pc from December. The mixed performance signals a sluggish start for the sector in 2025, following a record-breaking 2024 , when Mexico produced 3.99mn autos and exported 3.49mn. "While the industry continues to grow, it does so at a slower pace," said Guillermo Rosales, president of Mexican retailer association AMDA. Investment in Mexico's auto sector slowed in November and December, reflecting lower producer confidence and expectations of slower economic growth in 2025, Rosales added. AMDA forecasts 1.53mn auto sales in 2025, up by 2.2pc from a year earlier. But should the US impose a proposed 25pc tariff on Mexican vehicles, the forecast falls to 1.48mn sales. Inegi reported 10,881 electric (EV) and hybrid vehicles sold domestically in January, a 36pc annual increase. But sales fell by 30pc from December, marking the segment's first monthly decline since August. Automaker association AMIA said EV and hybrid production jumped by 60pc to 169,929 units last year. While AMIA did not report January figures, an Argus analysis of Inegi data shows production of four of Mexico's five EV and hybrid models reached 16,034 units in January, up by 86pc from December. Inegi did not separate production totals for the Wagoneer S EV and its internal-combustion counterpart, although AMIA reported 4,726 units produced in 2024. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

CME north EU HRC curve softens on US duty


25/02/11
25/02/11

CME north EU HRC curve softens on US duty

London, 11 February (Argus) — North European hot-rolled coil (HRC) futures prices softened today, as the market digested the imposition of 25pc US tariffs on all imports. During the London morning, March traded at €622/t in the broker market on CME Group's north European HRC contract, down from €633/t last Friday. April traded at €627/t, down from the last trade also at €633/t, before slipping to €625/t at 13:43 GMT. February traded at €602/t, a premium of €8.62/t to the month-to-date average of Argus' underlying north EU HRC index, at €593.38/t, with 13 trading days still remaining. On the CME screen, March traded down by €13/t to €620/t, while July nudged down by €2/t to €645/t. The US accounts for around 15pc of EU HRC exports and it takes another 1.3mn t across cold-rolled coil, hot-dip galvanised and tinplate, based on January-November 2024 data. It took over 683,000t of tinplate in the first 11 months of last year, from Germany and the Netherlands. The new US tariff, applied without exemption, could redirect tonnes to the EU, although the safeguard review will address this to some extent from 1 April. The tariff strengthens the case for an EU melt-and-pour clause against Chinese steel, and a meaningful revision to quota volumes, sources said. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Rain shuts Australian copper, fertilizer rail line


25/02/11
25/02/11

Rain shuts Australian copper, fertilizer rail line

Sydney, 11 February (Argus) — Torrential rains have shut Australia's Mount Isa rail line, which links phosphate and copper mines to the Port of Townsville in Queensland, with no reopening timeline in place. "The North Coast and Mount Isa rail lines have suffered severe damage with approximately 177 defects found so far," rail operator Queensland Rail (QR) said on 10 February. But the company has not yet examined parts of the line because of safety concerns, QR told Argus , preventing it from coming up with a reopening plan. Mining firm Glencore's Mount Isa copper and Australian manufacturer Incitec Pivot's Phosphate Hill fertilizer mines use the line to move commodities from production sites to the Port of Townsville, for export or distribution to other parts of Australia. Australian mining firm Centrex also uses the line to ship phosphate rock from its Ardmore phosphate project. Wet weather forced the Port of Abbot Point, located just south of Townsville, to close from 31 January to 5 February . The Port of Townsville remained open throughout that period, despite large parts of the city flooding. Incitec Pivot's Phosphate Hill plant is also currently facing non-weather-related challenges. The company lowered the mine's forecast production by 7pc to 740,000-800,000t for the 2025 financial year to 30 June, because of gas supply challenges. Argus ' MAP/DAP fob Townsville price was last assessed at $620-640/t on 6 February. By Avinash Govind and Tom Woodlock Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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