Nucor rebar mill adds to Midwest scrap competition

Nucor's new rebar micromill in Sedalia, Missouri, has commenced operations, giving Midwest ferrous scrap dealers another, albeit smaller, domestic outlet for obsolete tons.

Sedalia is the first of several new electric-arc furnace (EAF) projects to begin operation in the wake of the US Section 232 tariff on steel imports that will reshape US scrap flows if all are built.

The Sedalia mill began full melting and casting operations on 31 January, with a capacity of 450,000 st/yr of finished product, according to equipment provider Danieli.

Nucor intends to serve the regional rebar market with the smaller-scale mill, which faces less nearby competition. Nucor's nearest rebar mill in Nebraska is about 400 miles (640km) away, while rebar producer Commercial Metal's nearest mill is more than 400 miles away in Durant, Oklahoma.

From a scrap perspective, Nucor has a natural source of supply from urban hub Kansas City, Missouri, about 90 miles west of Sedalia, where its David J Joseph subsidiary Advantage Metals operates three locations in the metro area, including two auto shredders.

Nucor has also installed a new shredder on-site at the Sedalia mill, upping competition for shredder feedstock. The new shredder will not process more than 180,000 st/yr of shreddables on a monthly rolling basis, according to a state permit application. Nucor expects a typical melt to consist of roughly 50pc mixed heavy melt (HMS), 40pc shredded scrap and 10pc machine shop turnings.

The Sedalia mill, which is expected to consume around 30,000-35,000 gt/month of ferrous scrap, will compete for tons that have traditionally been shipped to Nucor's Nebraska mill or to consumers in Iowa, Arkansas and elsewhere.

Sedalia has also drawn the attention of dealers in the St Louis, Missouri, region, about 190 miles east, which includes shredding operations by Grossman Iron and PSC Metals. The city and location are connected via the Union Pacific railroad, giving scrap dealers with rail access a potential new natural outlet.

More EAFs will begin opening later in 2020 and beyond.

Later this year, Nucor will open an identical rebar micromill in Frostproof, Florida, and US Steel will begin melting at its first ever EAF at its tubular works in Fairfield, Alabama. The US Steel location bought a few thousand tons of scrap in February, a few weeks after TMS International agreed to handle scrap procurement for the mill, according to multiple sources. Fairfield is not expected to begin melting until the second half of 2020.

By Blake Hurtik