Hilde Merete Aasheim on Leading Norsk Hydro

September 2020

Hilde Merete Aasheim on leading Norsk Hydro

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September 2020 18 Industrial minerals: 18 Hilde Merete Aasheim 76 on leading Norsk Hydro Refractories Cover story Balancing bauxite

Fastmarkets Global Awards for Hilde Merete Aasheim, Steel Excellence Refractory-grade bauxite 2020 Winners 70 International CEO of Norsk Hydro, on aluminium prices have held firm due market trends Andalusite seeks new running a sustainable balance amid supply, to tightening supply business demand shifts Spotlights Aluminium The andalusite market has been rocked by a 78 25 drop in supply following Market spotlight: Steady global aluminium closures related to Steel scrap supply despite low Covid-19 in producing Bangladesh’s rapid demand countries industrialization in recent Global primary years means that scrap aluminium production 73 imports are growing fast has seen limited Chinese magnesia prices curtailment, despite challenge other producers 82 dented demand European magnesia End-user spotlight: caused by the Covid-19 markets have been very Heavy equipment pandemic sluggish in 2020 Heavy equipment manufacturers in the 28 74 mining industry lament Unlocking India’s Brown fused dwindling sales, but potential alumina falls China continues to buoy India’s aluminium Low capacity utilization the industry industry starts to bounce at China’s kilns for back from the lows of brown fused alumina lockdown and looks production, driven to exploit long-term by weak demand, is potential weighing heavily on markets Global Awards for Steel Excellence 82 33 Winners 2020 Fastmarkets celebrated the awards at a digital ceremony this year. Metal Market Magazine profiles the winning entries JCB

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News and analysis Regulars 8 8 7 Non-ferrous Comment news review Celebrating success A summary of recent key developments in the international non- 85 ferrous industries Innovations New developments in steel and metals 10 technology, processes Steel news review and products IMAGES GETTY A round-up of important 10 recent developments in the global iron and 86 steel sectors End-user Advances and market developments in 14 applications Base metals and steel analysis Fastmarkets MB research analysts study the drivers of the base metals, steel IMAGES GETTY and steel raw materials 86 markets RBSL

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6 | Metal Market Magazine | September 2020 Comment Celebrating success Magazine t an online virtual ceremony held on Published by Fastmarkets. US reporters: Rijuta Dey Bera, Bill 8 Bouverie Street,London EC4Y 8AX. Beck, Michael Cowden, Robert July 23, hundreds of people joined the UK registration number: 00142215 England, Patrick Fitzgerald, Lisa digital event to hear and see the winners of Tel: +44 20 7827 9977 Gordon, James Lawrence, Michael Fax: +44 20 7928 6892 and +44 20 Roh, Liz Ramanand, Orla O’Sullivan, the Fastmarkets Global Awards for Steel 7827 6495 Muyao Shen, Jenny Stewart, E-mail: [email protected] Dom Yanchunas Excellence declared. Despite the impacts Website: www.fastmarkets.com Fastmarkets IM of the Covid-19 pandemic this year, there was no Metal Market Magazine: Industrial Minerals Editor Europe: Editor: Richard Barrett Davide Ghilotti Seema Chaudhary less excitement and delight amongst the many Associate editor: Senior Reporter: William Clarke Advertising Sales: Market Reporters: Michael Publisher: Mary Connors finalists and winners participating. Greenfield, Sybil Pan, Carrie Shi Tel: 646 274 6250 Across 24 categories, notable achievements in the E-mail: [email protected] Global senior advertising manager, Global newsdesk editor: Mark Shaw steel industry and trade, from raw material supply, Europe/Turkey: Arzu Gungor US newsdesk leader: Sean Mayer Tel: +44 20 7827 5268 Senior sub-editors: Cecil Fung, Sara through steel production and processing, to product E-mail: arzu.gungor@ fastmarkets.com Kelly (US), Wei Jun Lau, Renate Foster Senior sales manager, Midwest, West Mas (US), Tony Pettengell, Jeff Porter innovation and recycling – as well as important Coast, North America: Jessica Kelliher Sub-editors: Francesca Brindle, Tel: 312 929 4195 Kyle Docherty, Hannah Corwin, technology development and service provision, such E-mail: Jessica.Kelliher@ Laura Kirk fastmarkets.com CEO: Raju Daswani as financial and legal – were recognized. A profile of Regional sales manager, Middle each of the winning companies’ entries is presented East/Africa, Asia, UK: Quincy Takyi Offices: “Our digital Tel: +44 20 7779 8735 London: Fastmarkets, 8 Bouverie in a major section of this issue of the magazine. E-mail: [email protected] Street, London, EC4Y 8AX, UK. Tel: event saw the Regional sales manager, East Coast, +44 20 7827 9977 The present continuing challenges of the Covid-19 North America: George Reeves New York: Fastmarkets, 1120 Avenue winners of the Tel: 212 224 3938 of the Americas, 6th floor, New York, pandemic add to many faced by our cover profile Fastmarkets E-mail: George.reeves@ NY 10036, USA. Tel: +1 (212) 213 6202. fastmarkets.com Toll free: 1 800 METAL 25, Fax: +1 interviewee, Hilde Merete Aasheim, President and Global Awards Events and client services marketing (212) 213 6617 manager: Adelaida Montilla Pittsburgh: 707 Grant Street, Suite 1340, CEO of Norsk Hydro, during her career, which have Tel: 212 224 3937 for Steel Pittsburgh, PA 15210, USA. E-mail: Adelaida.montilla@ Tel: +1 (412) 765 2580 also included the Global Financial Crisis in 2007-09 fastmarkets.com Excellence Singapore: Quadrant at Cecil, 3F, Advertising sales administrator: 19 Cecil Street, Singapore, 049704 and a major cyber-attack on the company. She Eva Cichon Shanghai: Fastmarkets, Room 305, declared” Tel: +44 (0)20 7827 5263 3/F, Azia Center, 1233 Lujiazui Ring discusses the opportunities she has taken and the E-mail: [email protected] Road, Shanghai 200120. Production design: Tony Herman, successes she has seen, as well as the challenges she Dany Pena and Raveendra Karanth Tel: +86 21 5877 0857. Fax: +86 21 5877 0856 has encountered, in an exclusive interview. Fastmarkets MB: São Paulo: Rua Prof. Atílio Innocenti The main features sections in this edition cover Group editorial director: Alex Harrison 165, 7th floor, Rooms 106-107, São Global ores, alloys, minor metals Paulo, SP, 04538, Sao Paulo, Brazil. major trends in global aluminium markets and and industrial minerals editor: Tel: +55 11 3197 8750 Fleur Ritzema Customer services dept: developments in industrial minerals markets for Europe ores, alloys and minor Tel: +44 (0)20 7779 7390 metals editor: Charlotte Radford materials used to make refractories. As in so many Global base metals editor: Subscription enquiries: Juliet Walsh Tel: UK: +44 (0)20 7779 8260. commodity markets, the impact of the Covid-19 Europe base metals editor: USA: (877) 638 2856/(412) 765 3581 Archie Hunter Email: [email protected] pandemic is impacting both supply and demand. But Global steel editor: Andrew Wells Fastmarkets is a part of Euromoney EMEA, CIS, Turkey steel editor: Ross Yeo Global Limited: 8 Bouverie Street, it is where those impacts are significantly greater on Special correspondents: London EC4Y 8AX. Andrea Hotter, Janie Davies Directors: Leslie Van de Walle one side of the market balance than the other that UK and Europe correspondents (chairman), Andrew Rashbass (ceo), prices are on the move. and reporters: Cristina Belda, Wendy Pallot, Colin Day, Tristan Julia Bolotova, Carrie Bone, Hillgarth, Imogen Joss, Tim Collier, Marina Vertemburg Bozkurt, Kevin Beatty, Jan Babiak, Lorna Tilbian Our market spotlight section looks at the growing Hassan Butt, Declan Conway, Serife importance of ferrous scrap imports to Bangladesh Durmus, Amy Hinton, Julian Luk, Copyright notice: © 2020 Euromoney Ewa Manthey, Alice Mason, Vlada Global Limited trading as Fastmarkets Novokreshchenova, Marina Shulga, All rights reserved. No part of this to feed its growing steel industry, while our end-user Jon Stibbs, Maria Tanatar, Cem Turken, publication (text, data or graphic) Justin Yang spotlight covers interesting innovations in heavy may be reproduced, stored in a data Latin America reporters: Felipe equipment used for construction and mining, Peroni, Renato Rostás retrieval system, or transmitted, Asia ores, alloys and minor metals in any form whatsoever or by any including electric and autonomous heavy vehicles editor: Susan Zou means (electronic, mechanical, Asia steel editor: Paul Lim photocopying, recording or and excavators. Senior correspondents (Asia): otherwise) without obtaining Lee Allen, Alex Theo, Karen Ng Fastmarkets’ prior written consent. As in each issue of Metal Market Magazine, our Analysts (Asia): Hui Li, Min Li, Ruby Unauthorised and/ or unlicensed Liu, Siyi Liu, Amy Lv, Sybil Pan, Carrie copying of any part of this publication regular sections provide Fastmarkets research Shi, Miranda Song, Anna Xu, Sally is in violation of copyright law. Zhang, Jessica Zong Violators may be subject to analysis of base metals, steel and steelmaking raw Prices manager: Mary Higgins legal proceedings and liable for substantial monetary damages for material markets, ferrous and non-ferrous news Fastmarkets AMM each infringement as well as costs Managing editor, Americas: and legal fees. Brief extracts may be review pages, and product and process innovations. Thorsten Schier used for the purposes of publishing North America non-ferrous editor: commentary or review only provided Chris Kavanagh that the source is acknowledged. North American steel editor: ISSN 0002-9998. Grace Lavigne Asenov North America scrap editor: Find us at: www.metalbulletin.com; www.amm.com; www.indmin.com Sean Barry

September 2020 | Metal Market Magazine | 7 News review: non-ferrous China issues 11th round of scrap import quotas China has issued its 11th round of scrap metal import quotas for 2020, marking the third batch announced during the third quarter. The latest batch permits 2,610 tonnes of aluminium scrap to enter China, the China Solid Waste & Chemicals Management Bureau said on August 18. This adds to the 1,110 tonnes of aluminium scrap allowed under the 10th round of quotas, announced on July 24. So far in 2020, China has allowed importers to buy up to 697,379 tonnes of aluminium scrap from abroad, with its IMAGES GETTY total for the third quarter at China’s latest scrap metal import quota permits another 2,610 tonnes fuelled by demand in 213,380 tonnes, already products such as aluminium ingot surpassing the 199,450 tonnes granted in the preceding silico-manganese containing “With the announcement of EC launches probe into quarter. 65% manganese, 16% silicon, the construction of the new Chinese aluminium flat Market participants largely 2% carbon, 0.1% phosphorus combination micromill, we are attributed the increased and 0.15% sulfur. also announcing the permanent rolled products volume to a greater number of closure of the Rancho The European Commission has applications for imported San Ciprián Al smelter Cucamonga mill facility,” the opened an anti-dumping aluminium scrap owing to a letter said. “The new mill will investigation into certain spike in demand for consultation extended feed the large underlying West aluminium flat rolled products aluminium ingot ADC 12 from Aluminium producer Alcoa Coast demand for rebar and originating from China, it said Japanese automakers, with has reached an agreement with merchant bar, replace on August 14. some producers said to have the workers’ representatives inefficient existing rebar This follows a complaint returned to 80-90% of for the San Ciprián aluminium capacity at the Rancho facility, made by European Aluminium, “normal” operating levels smelter in Spain to extend the and monetize the significant the industry association that since the beginning of August. deadline of a formal value associated with our represents the aluminium Aluminium ingot ADC 12 is consultation period for Southern California real industry in Europe. typically produced using collective dismissals to estate.” In a statement, European aluminium scrap. September 28, the company Previously, CMC ended Aluminium urged EC to follow announced on August 13. meltshop operations at the through with appropriate Transalloys to cut SiMn The extension will include a mill in October 2019. anti-dumping measures to output by 30% in 2020 process intended to evaluate a minimize the harmful effects of potential sale of the aluminium Codelco resumes El unfairly priced Chinese imports. South African manganese smelter to GFG Alliance, The EC earlier opened an alloys producer Transalloys which has expressed an Teniente expansion anti-dumping investigation into will reduce its silico- interest in acquiring the unit. State-run Chilean copper aluminium extrusions manganese production by Fastmarkets reported on producer Codelco is resuming originating from China on about 30% this year due to August 10 that Liberty House work at an expansion of its El February 14. weakening market prices, it Group, part of GFG Alliance, is Teniente division, and the was revealed on August 19. interested in purchasing the San project should reach full capacity BHP targets ‘future- The reasons for this, Ciprián aluminium smelter. “in a couple of months,” chief according to an official from executive officer Octavio facing’ commodity the sales agent that sells all of CMC to shutter Rancho Araneda said on August 13. growth Transalloys’ output, were the The company idled works at Miner BHP has identified what high cost of power in the Cucamonga mill the facility in the central it has termed “future-facing country and the slump in Commercial Metals Company Bernardo O’Higgins region, commodities” in which it plans end-user demand in sales (CMC) will be closing its 100 km South of the capital to invest further, based on target regions resulting from Rancho Cucamonga mill Santiago in early July to limit trends for demand growth in the the Covid-19 pandemic. facility, according to a letter to the spread of Covid-19 among medium to long term – these Transalloys produces customers dated August 13. its employees. are copper, nickel and potash.

8 | Metal Market Magazine | September 2020 Creating and securing more Department of Commerce financing, which accounts for entire stake in manganese options in these commodities show. around 45% of its current client alloy smelter Tasmanian will be a priority because this UBC scrap imports from loan portfolio, and will wind Electro Metallurgical Co will protect and grow value over Canada increased by 21.7% to down units in the United (Temco) to United Kingdom- the long term, the company’s 7,291 tons in June, but States, Asia, Australia and based conglomerate GFG chief executive officer said. shipments from Mexico Brazil, in a process expected to Alliance for an undisclosed “Decarbonization, decreased by 47.4% month on take around three to four years. amount, it said on August 13. electrification, diet, land use and month to 5,231 tons. “The Trade & Commodity The miner, which is listed population trends will all drive Finance activities will be on the stock exchanges in higher demand for copper, Court rejects Vedanta’s exited, and in Natural London, Australia and nickel and potash in the medium Resources and Transportation Johannesburg, owns to longer term,” Mike Henry plea to restart Indian & Logistics we will focus on manganese ore and alloy said during a presentation on copper smelter European clients only,” chief assets in South Africa and the company’s results for the The Madras High Court of executive officer Robert Swaak Australia through its stake in fiscal year ended June 30. India has rejected Vedanta’s said in a note to shareholders. Samancor Manganese, a joint “We’re, therefore, looking to plea to restart its Tuticorin venture with Anglo grow in these future-facing copper complex, which has Dongying Fangyuan’s American. commodities.” been closed since 2018. Temco is run by the The long-awaited verdict phase 2 smelting line to Samancor Manganese Joint Kennecott delay dents came on August 19 to uphold an start in October Venture, owned 60% by earlier decision to keep the Copper smelter Dongying South32 and 40% by Anglo Rio Tinto Cu guidance 400,000 tonne-per-year copper Fangyuan is planning to American. Rio Tinto has further cut its complex in Tamil Nadu closed restart its phase 2 smelting 2020 production guidance for with no access to electricity. production line in October, SQM lithium Q2 sales soar, refined copper, by about 16%, In 2018, 13 locals were Fastmarkets has learned. after delays to the restart of the killed in a shooting incident The phase 2 operation line but H1 revenue down smelter at its Kennecott mine during a protest against water has capacity to process Results for the lithium in Utah in the United States, and air pollution in the area. 300,000 tonnes per year of division of Chilean producer the company said this week. The plant, operated by copper cathodes using copper Sociedad Quimica y Minera The delay was caused by Vedanta’s subsidiary Sterlite, concentrates. (SQM) for the first six months unexpected issues following a was ordered to be shut “The company will start to of 2020 showed that sales scheduled 45-day maintenance permanently although run phase 2 because the phase were up by 45% quarter on shutdown that was scheduled Vedanta described the order 1 production line has to quarter in the April-June for May. as a political decision. undergo maintenance in quarter despite being down “We are working closely with October for one month after by around 7% year on year our customers to limit any ABN Amro ending operating for two years,” a overall in the first half of disruption and expect to have source familiar with the 2020. the smelter fully operational in commodity financing matter told Fastmarkets. Lithium sales totaled [the next] two months,” Rio ABN Amro will end its 12,600 tonnes in the second Tinto said on August 18. financing activities for GFG to buy South32 Temco quarter, in line with the Rio Tinto’s 2020 production commodity clients globally, it company’s intention to guidance for refined copper said on August 12. Mn alloy smelter increase lithium sales this now stands at 135,000- The Dutch bank will stop all Western Australia-based year to gain market share. 175,000 tonnes. non-European corporate miner South32 will sell its Total revenue from the lithium division fell by 48% US UBC imports climb year on year for the first six months of 2020 amid lower again in June lithium prices. The company Imports of used beverage reported that average cans (UBCs) into the United lithium prices for January- States inched higher again in June were down by around June as a result of squeezed 45% year on year. domestic supply due to Company operations restrictions on recycling continued with no material operations, Fastmarkets consequences related to the understands. global Covid-19 pandemic, The United States SQM said. imported 18,654 tons of Sales volumes (lithium, UBC scrap in June, up by derivatives) were at 21,200 3.9% from 17,961 tons in tonnes, down by 7% from

May, bringing the year-to- IMAGES GETTY 22,800 tonnes, while revenue date total to 80,130 tons, Imports of used beverage cans into the US inched higher in was $151.2 million, down by figures from the US June on reduced domestic supply 48% from $293.6 million.

September 2020 | Metal Market Magazine | 9 News review: steel

Drilling slips in the US drive toward energy reform and the use of fewer fossil fuel and rises in Canada resources. The number of drill rigs Shanxi is the country’s running in the United States second-largest continued to fall during the coal-producing province. It week ended August 14, plans to shut down 32 coal slipping by three rigs to bring mines with total capacity for the total to a record low of 20.74 million tonnes per year 244 rigs. in 2020, as part of the The drop was driven by the country’s drive to reduce US oil rig sector, which pollution and overcapacity in declined by four. The gas the coal sector. sector, meanwhile, rose by The plan was published in a one rig from the previous notice from the general office week. of the Shanxi provincial The current rig count is IMAGES GETTY government in July. And a down by 73.9% from this time The US Department of Commerce will continue its inquiry into detailed capacity-reduction last year, when 935 rigs were imports of standard steel welded wire mesh from Mexico list was attached to another in operation, according to notice issued by the data from Baker Hughes Inc. “As a result of the GM opens redundancy authority. The US rig count fell below Commission’s affirmative plan in Brazil The province achieved its 250 rigs the previous week. determinations, the US capacity-reduction target The last increase was Department of Commerce will The Brazilian branch of car during the country’s 13th recorded during the week continue its investigations of manufacturer General Motors Five-Year Plan (FYP) period ended March 6. imports of standard steel (GM) extended the furlough of 2016-20, a year ahead of Meanwhile, drilling in welded wire mesh from period for some employees at schedule. Canada rose by seven rigs to Mexico, with its preliminary its plants and is opening a Coal de-capacity is part of 54 rigs, which was the highest countervailing duty voluntary redundancy plan at China’s supply-side reforms, count since reaching the determination due on or about its São Caetano do Sul unit, the which includes policies same level during the week September 23, 2020, and its company told Fastmarkets on intended to reduce domestic ended March 27. Still, the preliminary anti-dumping August 12. coal production and to August 14 tally was still down duty determination due on or Brazil’s automotive industry bolster domestic coal prices. by 62% from 142 rigs at this about December 7, 2020,” ITC was gradually recovering from time last year. added. the restrictions imposed CMC to build $300mln earlier in the year to curb the micro-mill in Arizona ITC votes to continue ArcelorMittal to build spread of the Covid-19 pandemic, which led to almost Commercial Metals Co Mexican wire mesh EAF at Calvert all vehicle and auto parts (CMC) plans to build a new probe ArcelorMittal is planning to producers closing their doors $300-milllion micro-mill in The United States build a 1.5-million-ton-per- in late March. Mesa, Arizona, it said on International Trade year electric-arc furnace (EAF) Light vehicle output August 13, noting that this will Commission (ITC) determined steelmaking facility at its reached a record low of 1,800 be its third micro-mill overall there is sufficient grounds to manufacturing complex in units in April after these and its second in Mesa. continue a Department of Calvert, Alabama, the company actions, national automotive The facility is expected to Commerce investigation into announced on August 12. association Anfavea said on achieve a nominal annual imports of standard steel The facility will make slab to May 8. capacity of 500,000 tons, welded wire mesh from feed the hot-rolling mill at AM/ Production has been including 150,000 tons of Mexico, according to an NS Calvert. Construction is recovering since then, albeit at merchant bar quality (MBQ ) August 13 statement. expected to take 24 months and a slow pace. Light vehicle product, when the mill begins “The United States create 300 jobs in the local output was 170,300 units in commissioning in early 2023, International Trade community, the steelmaker July, a significant increase from CMC announced, noting that Commission today said. the April low but still down by the mill will employ about 185 determined that there is a “An electric-arc furnace at 36.2% from 267,000 units a people. reasonable indication that a Calvert makes strategic sense as year before, the association CMC currently operates a US industry is materially it allows our asset to be more said on August 7. micro-mill in Mesa and in injured by reason of imports of reactive to the local market as Durant, Oklahoma. standard steel welded wire well as being in line with the China turns to mergers The new mill will replace mesh from Mexico that are USMCA [United States- higher-cost rebar capacity and allegedly subsidized and sold Mexico-Canada Agreement],” for energy reform allow the company to meet in the United States at less than chairman and chief executive China is turning to mergers, West Coast demand for rebar fair value,” according to the officer Lakshmi Mittal said in a acquisitions and mine and MBQ steel, CMC said, statement. statement. shutdowns to maintain its adding that the mill will be the

10 | Metal Bulletin Magazine | September 2020 first facility in the world to exposure to the automotive company said on August 13. company announced late on produce MBQ products sector, which suffered greatly “This new order will allow August 13. through a continuous- due to the Covid-19 us to operate our Welspun The investment will continuous production pandemic, sources told large-diameter pipe mill and amount to $1.5 billion, and process. Fastmarkets. continue to provide direct the project will include the Brazil’s steel industry took jobs for over 500 workers in opening of new mining areas, Mexican vehicle output a heavy hit from regional Little Rock, Arkansas,” the duplication of a restrictions in the country to Welspun president of the long-distance belt conveyor inches up in July contain the spread of the Americas Rusty Fisher said in and the implementation of Mexican production of light coronavirus. Demand fell a statement. new processing lines at the vehicles increased by 0.65% significantly in April and Berg Pipe will also supply plant, among other measures. year on year in July, according recovered at a slow pace TC Energy with an to national automotive throughout the remainder of undisclosed amount of line BlueScope pressing on association Amia. the second quarter, pipe for the Keystone XL The country produced particularly for flat steel. pipeline project, the with Ohio expansion 294,946 light vehicles in the Data from Instituto Aço company said on August 10. North Star BlueScope month, compared with Brasil, the country’s expects to commission the 293,035 units a year before, steelmakers’ association, Vale to expand iron ore $700-million expansion of according to the figures showed that domestic sales of its electric-arc-furnace released on August 6. flat steel totaled 1.92 million output in Carajás region (EAF) operations in Delta, The results were better than tonnes during the second The board of directors of Ohio, in the second half of expected, according to the quarter, down by 29.1% from Brazil-based miner Vale has 2022, parent company association, because the 2.71 million tonnes a year approve a project to expand BlueScope Steel Ltd said on sector has been recovering earlier and by 28.3% from capacity in the miner’s Serra August 17. from the effects of the 2.68 million tonnes sold in Sul iron ore site, in the While the expansion was Covid-19 pandemic, which the first three months of country’s northern Carajás delayed in April due to the led to a halt in production in 2020. region, by 20 million tonnes Covid-19 pandemic, the March. to 120 million tonnes per company said the project TC Energy taps Welspun year. remains a priority and Usiminas loses lead in The Serra Sul 120 project should see a full ramp-up for Keystone XL supply will expand the production approximately 18 months Brazilian flat steel mart Welspun Tubular will supply capacity of Vale’s S11D mine after commissioning begins. Brazilian flat-rolled steel TC Energy with more than and plant, which is the main producer Usiminas has lost 1 million feet of 36-inch line unit in the Carajás region, Egypt rebar consumption the lead in its domestic pipe for the Keystone XL with start-up expected to the market due to its strong pipeline project, the first half of 2024, the decreases by 33% in July Egypt consumed 439,000 tonnes of rebar in July 2020, 33.48% less than the 660,000 tonnes it consumed in July 2019, Egyptian sources told Fastmarkets. This was up from 312,000 tonnes of rebar consumed in May 2020, but down from 658,000 tonnes of rebar in June 2020, sources added. The reasons behind Egypt’s falling rebar consumption were the Eid al-Adha holidays at the end of July as well as a construction ban, sources said. Brazilian steel use up 4.4% in July Brazilian apparent steel consumption rose by 4.4% GETTY IMAGES GETTY year on year in July 2020, Brazilian apparent steel consumption rose by 4.4% year on year in July 2020 buoyed by the with the long steel sector country’s construction sector demand for long steel continuing to outperform

September 2020 | Metal Bulletin Magazine | 11 News review: steel flat steel, national and Vattenfall, has steelmakers’ association completed successful trials Instituto Aço Brasil said on of fossil-free fuels in the iron August 14. ore pellet process, it Consumption totaled 1.84 announced on August 5. million tonnes in July, up The companies reported from 1.76 million tonnes a that trials using fossil-free year earlier and the highest fuels at LKAB’s pellet plant monthly figure since October have shown that the first 2019. fossil-free iron ore pellets are The resilience of the within reach. country’s construction sector The project is intended to during the Covid-19 be the world’s first with a pandemic was leading the value chain for fossil-free (or recovery through its higher ‘green’) steel, using demand for long steel. sustainable or renewable Long steel consumption energy along with hydrogen reached 840,000 tonnes in in the steelmaking process, LKAB July, up by 13.4% from and has ambitions to reduce 740,000 tonnes in the SSAB, LKAB and Vattenfall’s Hybrit initiative will trial fossil-free Sweden’s carbon dioxide corresponding month last fuels in the iron ore pellet process at LKAB’s plant emissions by 10%. year. Flat steel demand, on the other hand, was 999,000 Despite the challenging 57,492 tonnes of products in Thyssenkrupp reports tonnes, a 2.1% year-on-year start to 2020, the company the first ten days of August, decrease from 1.02 million believes the current crisis in against planned shipments of large earnings fall tonnes. the steel industry is an only 50,433 tonnes. And Thyssenkrupp’s opportunity to accelerate its figures indicated that BMZ performance for the April- Liberty Steel to acquire digital transformation. would fulfil all its obligations June period was notably “Our transformation to clients this month, he weaker compared with the French steel rail strategy is taking effect. With added. previous year due to the producer Hayange the Klöckner assistant, in effects of the Covid-19 Liberty Steel Group, part of particular, we have once SA Recycling buys Steel pandemic on key customer the GFG Alliance, is to buy again accelerated the growth segments. French steel rail business of our sales via digital City Recycling Weeks of stoppages and a Hayange and the Ascoval channels,” Gisbert Rühl, SA Recycling LLC has massive output slump in the steelworks. chief executive officer of expanded its footprint in the automotive sector have Liberty Steel Group has Klöckner said. southeastern United States greatly affected materials committed to providing an Earnings before interest, with the acquisition of Steel and components businesses. initial €65 million ($76.83 taxes, depreciation and City Recycling LLC in As a result of customers’ million) in new financing for amortization (Ebitda) were Birmingham, Alabama, the temporary plant closures, Hayange and Ascoval to €61 million ($72.11 million) company announced on production in many areas enact its industrial plan. loss, down from €84 million August 17. came almost to a halt at the Further details of in the second quarter of The deal includes Steel start of the third quarter, the development plans for the 2019. City’s Birmingham operation company said. sites will be announced in and its facility in West Point, The company’s European due course, Liberty Steel BMZ reports production Mississippi. steel segment generated said on August 14. Orange, California-based significantly weaker results running normally, but SA Recycling said the due to both lower prices and Klöckner & Co shows protest continues acquisition grows its volumes and the Belarus Steel Works (BMZ) Southeast shredding and consequently weak capacity Q2 earnings drop, set to was operating at full capacity metals operations, while also utilization. grow digital channels and all stages of production increasing its scrap Thyssenkrupp’s third- A summary of the financial were progressing normally, purchasing volumes in the quarter results for results of German metals the company said on August area. continuing operations, distributor Klöckner & Co for 11, after the start of a protest excluding the elevator the second quarter of 2020 at the mill the day before. Hybrit reports success in sector, (year-on-year shows the impact from the BMZ general director change) showed sales of Covid-19 pandemic resulted Dmitry Korchik said that the its fossil-fuel free pellet €5.76 billion, down 34.1% in a significant steel demand company had been exceeding trials from €8.74 billion. Earnings drop from the main consuming planned production at all The fossil-free steel before interest and tax (Ebit) sectors such as automotive, process stages since the initiative joint venture showed a loss of €729 construction and mechanical beginning of this month. known as Hybrit, ̶ million, up from a loss of €39 engineering. The company shipped comprising SSAB, LKAB million year on year.

12 | Metal Bulletin Magazine | September 2020 PARTNERSHIPS DRIVEN BY INNOVATION

We are grateful for the incredible customers who partner with us every day. Thank you, General Motors, for the honor of being the ﬁ rst EAF steel producer to be named a GM Supplier of the Year two years running.

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www.nucor.com Market analysis Aluminium Lead Risk-reward tips less in favor of upside Beyond fundamental fair value LME aluminium continued its L cas price t We think the lead market’s L cas price t uptrend in August, almost fundamentals do not justify the 2,300 2,600 reaching $1,800 per tonne, as run up in LME prices to $2,000 bullish macro themes and the 2,050 per tonne in August given our 2,325 weight of money in financial 1,800 expectation for a global surplus 2,050 markets have driven this market around 350,000 tonnes this year higher, despite its poor 1,550 (3% of consumption). This is 1,775 LME/Fastmarkets LME/Fastmarkets fundamentals. The relative lack of 1,300 especially so if secondary 1,500 Jul 19 Jul 18 Jul 19 Jul 20 Jul 18 Jul 20 Jan 19 Sep 19 Sep 18 Jan 19 Jan 20 Jan 18 Sep 19 Sep 18 Nov 19 Mar 19 Nov 18 Mar 18

Covid-19-related supply Nov 19

Mar 19 production (two-thirds of global Nov 18 Mar 20 Mar 18 May 19 May 18 Mar 20 May 19 May 20 May 18 Sep 20f May 20 Sep 20f disruptions, or sufficient restraint refined lead supply) recovers among producers, has combined different in China, however, alongside demand in Q3 and Q4, seen prices detach from the with a weakened demand outlook where SHFE stocks are falling due as economies continue to fundamentals in previous times of and is building oversupply. We to better domestic demand but normalize after Covid-19 high liquidity (such as after the continue to forecast a 4-million- also a shift by smelters to produce lockdowns. But the effect on dot-com bubble). The concerted tonne global surplus this year, billet instead of SHFE-deliverable prices of less-than-bullish government rescue effort under which at around 6.7% of annual ingots. The higher prices are fundamentals are overshadowed way is unprecedented. In this consumption is the largest of all pulled by the macro factors ; the by the weight of money pouring regime, we are looking at the base metals. The oversupply is more out-of-sync they become into commodities on easy technical indicators for short- in part showing up in LME with fundamentals, the bigger the financial conditions created by term direction and, for lead, warehouses where inflows of more correction. This concern is the massive monetary and fiscal breaking resistance around than 1.2 million tonnes have been perpetuating a ‘sell the rally’ policy stimulus. This is what has $2,100 per tonne in the next seen this year so far. The story is mentality. lifted all metal prices. We have month or two would be bullish. Copper Nickel Uptrend intact Not bullish enough LME copper extended its strong L cas price t We were the most bullish L cas price t uptrend with a new higher high 7,300 price forecaster for Q3 2020 18,000 on August 19 at $6,707 per based on submissions to tonne after a month-long period 6,600 Fastmarkets’ latest Apex 16,000 of consolidation. Supply 5,900 survey. Our average LME 14,000 disruptions are a supportive cash price for the period was 5,200 12,000 theme, with protests at Freeport LME/Fastmarkets $13,900 per tonne. But with LME/Fastmarkets McMoRan’s giant Grasberg 4,500 daily prices breaching the 10,000 Jul 19 Jul 19 Jul 18 Jul 18 Jul 20 Jul 20 Jan 19 Jan 19 Sep 19 Sep 19 Sep 18 Sep 18 Jan 20 Jan 20 Nov 19 Nov 19 Mar 19 Mar 19 Nov 18 Nov 18 Mar 18 Mar 18 Mar 20 Mar 20 May 19 May 19 May 18 May 18 May 20 May 20 Sep 20f mine in Indonesia in the Sep 20f $15,000 level in late August headlines again as we write. We for the first time since now estimate 1.823 million record import volumes at times November 2019 and already looming shortages of battery- tonnes of unplanned mine due to an open arbitrage window. averaging $13,800 per tonne friendly class 1 nickel. Our production losses in 2020 from These bullish fundamentals are this quarter, even we were research shows that after all causes, including 1.151 bolstering the investment flows not bullish enough. Metals massive investment in NPI million attributed to Covid-19 in the prevailing positive macro with the more bullish capacity in Indonesia in alone. These figures continue to reflationary environment. narratives have tended to fair recent years, class 2 nickel edge higher. The demand Together with the continuation better in the liquidity-fuelled (not suitable for battery recovery is also supportive, of copper’s uptrend off the rallies since the Covid-19 makers) accounts for 63% of especially in China, where we March lows confirmed by the lows in March. Tesla’s Elon total production, up from a calculate apparent consumption August high and seasonality in Musk calling for companies 50/50 split in 2016. EV was up no less than 15% year on September, we expect to see to mine more nickel to nickel price rallies tend to be year in the January-July period, further higher highs in the support the EV revolution short-lived. The reality is this albeit boosted by stockpiling and coming weeks. was a reminder of the is a long-term story.

In this regular section, Fastmarkets MB’s research team summarize their in-depth reports to highlight key factors driving the markets and their short-term price forecasts. The weekly service, Base Metals Market Tracker, provides independent analysis and forecasts for base metal markets and prices.

14 | Metal Market Magazine | September 2020 World leading market analysis www.fastmarkets.com

Tin Steel Seasonally stronger from September Chinese steel demand boomed in the second quarter The LME tin price has L cas price t performed relatively weaker than 22,000 the other base metals in August. Chinese domestic and export astmarkets steel indices The negative summer effect on 20,000 prices maintained their 120 Jan 2012 = 100 demand conditions has been felt 18,000 uptrend in August, although more strongly in this market. The flat steel prices continued to 110 16,000 LME cash/three-month spread LME/Fastmarkets rise at a faster pace than long 100 has been backwardated 74% of 14,000 steel prices. The ex-warehouse

Jul 19 90 Jul 18 Jul 20 Jan 19 Sep 19 Sep 18 Jan 20 Nov 19 Mar 19 Nov 18 Mar 18 Mar 20 May 19 May 18 May 20 the time since 2015, averaging Sep 20f hot-rolled coil (HRC) $50 per tonne, but reverted to a assessment in eastern China 80 contango in August. Similarly, incrementally, we expect the ticked over the 4,000-yuan exchange stocks have rebounded refined market to be essentially mark at the start of the month, 70 by 1,600 tonnes, or 22%, in balanced. Given the positive reaching 4,080 yuan ($590) 60 August to date, with the LME macro environment (weaker per tonne on August 19, accounting for the bulk of the dollar, stronger yuan, and although prices trended 50 Jan 17 Jan 12 Jan 13 Jan 15 Jan 14 Jan 16 Jan 19 Jan 18 July 17 July 12 Jan 20 July 13 July 15 July 14 July 16 July 19 July 18 July 20 rise. But conditions are expected reflationary dynamics), we slightly lower towards the end May 20 Global flat products index to improve from September, expect tin prices to gain some of the month. The export Global long products index driven by a pick-up in consumer strength. This is especially true HRC index moved up as well Steel price index Fastmarkets MB buying appetite after the slow considering the seasonality of the and at $510 per tonne on summer months. Although August 21 was at its highest Steel market in Cina returned to LME tin price turns friendly in deicit in global refined production is likely September after being negative level since July last year. to continue to increase in August. Rebar prices were more stable in August, but still showed increases compared to July levels. Zinc million tonnes But steel price rises brought - Bullish revisions little relief to mills’ margins - amid a rally in iron ore prices. - Since the start of July, the Fastmarkets’ estimates of L cas price t rebound trajectory of zinc 3,600 real-time margins show that Source: NBS, Steelhome, Fastmarkets prices has shifted to a steeper HRC margins at BOF gradient as investors have 3,125 producers rose to $26 per and $51 in the previous two sought relative value in the 2,650 tonne in late July-early years. base metals complex. After a August, after fluctuating near Our estimates suggest that slow start off the March lows, 2,175 LME/Fastmarkets zero between March and June, steel demand in China zinc has now reached the 1,700 but they started to move down rebounded strongly in the Jul 19 Jul 18 Jul 20 Jan 19 Sep 19 Sep 18 Jan 20 Nov 19 Mar 19 Nov 18 Mar 18 Mar 20 May 19 May 18 May 20 $2,500 per tonne level and Sep 20f again. Rebar mills had a better second quarter of the year surpassed its pre-Covid-19 start to the year than their after a fall at the start of 2020 highs. The accelerated rally has also be an important HRC counterparts, but as caused by Covid-19 led us to mark our Q3 base-case beneficiary of infrastructure rebar price increases slowed, disruptions. An increase in forecast with an upgrade to an spending committed by rebar margins slipped into stocks in the first quarter average of $2,310 per tonne, governments as part of negative territory in August. meant that real steel from $2,200 per tonne stimulus measures to counter However, 2020 has been the consumption that takes into previously. The higher price is the negative effects of worst year so far in terms of account inventory changes in realistic given the fresh focus Covid-19 on economies. We profits for Chinese mills since the supply chain dropped by on the continuing risk of have revised our refined zinc the market downturn of 2015 5.9% year on year, the first virus-related supply supply-demand balance and 2016. The year-to-date such decline since the end of disruptions after the San recently, lowering the annual average HRC margins stand 2016. But with a resumption Cristobal mine in Bolivia was refined market surplus for at $8 per tonne, down from a of economic activity demand suspended and as infection 2020 to 266,000 tonnes, from peak of $121 in 2018 and $32 quickly bounced back, leading rates soar in India. Zinc should 298,000 previously. in 2019, while the 2020 to a 9.1% rise in real average for rebar is $15 per consumption in the following Analysis by Andy Cole, Fastmarkets MB tonne compared with $125 quarter.

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September 2020 | Metal Market Magazine | 15 Market analysis

As demand has been growing faster than supply (or Steel raw materials apparent consumption), the China continues to import metallics and semi-finished steel Chinese market that saw a build-up of a steel surplus of This year has seen the trend astmarkets steelmakin raw (BF) operating rates, which over 30 million tonnes in the in China for importing materials indices have remained above the first three months of 2020 relatively cheap iron 140 Jan 2012 = 100 90% level since mid-April. swung back into a deficit. This metallics, and semi-finished 100 The rising iron ore demand dynamic is typical for China, steel products continue from has in part seen a surge in as market participants last year. This in part reflects 60 iron ore prices, albeit supply prepare for a busy second strong demand from 20 constraints have also been Jan 17 Jan 12 Jan 13 Jan 15 Jan 14 Jan 16 Jan 19 Jan 18 July 17 July 12 Jan 20 July 13 July 15 July 14 July 16 July 19 quarter at the start of the year, July 18 metallics-consuming electric July 20 present, with for example but in 2020 fluctuations were arc furnaces (EAF), which Asian import HMS No1 cfr iron ore Fe62 % fines at a larger scale, as our chart have maintained operating Fines 63.5% cfr main China ports ($/tonne) reaching $127.38 per tonne Australian hard coking spot fob price (metric) illustrates (see previous page). rates above 70% since Fastmarkets cfr Qingdao on August 21, The average first-quarter mid-April and above 80% up from $84.04 at the end of surplus in the 2015-2019 since late March, Steelhome Cinas imports o semis and April. Nevertheless, metallics reac new is period was 8.7 million tonnes, data shows. estimated hot metal costs followed by the average deficit Meanwhile, the strong have also remained price- of 5.7 million tonnes in the import demand for metallics emis attractive relative to second quarter, but this year and semis is also highlighting domestic scrap, having been the swings were more than their continued price at an average of $42 per millio toes three times bigger. attractiveness relative to tonne below Chinese scrap

Rebar showed similar domestic ferrous scrap. For this year up to August 21. dynamics as the steel market example, the domestic Nevertheless, the in general, and according to Chinese scrap, excluding premium that scrap has over our estimates apparent rebar VAT, averaged at a $20 per ISSB, NBS data via Steelhome hot metals and metallics has consumption reached 66.7 tonne premium over CIS begun to diminish and million tonnes during the merchant pig iron (MPI) 1.63 million tonnes. should fall further this year second quarter, up by 27.9% Black Sea export prices from Similarly, semi-finished steel as imported material quarter on quarter. Demand, the start of the year up to imports totalled 3.34 million competes with domestic or real consumption, August 21, keeping MPI tonnes during the last scrap. For example, scrap’s increased even stronger, more prices attractive relative to quarter, up from 1.65 premium to hot metals fell than doubling in the April- scrap even when considering million tonnes imported in to $21 per tonne on August June period compared to the delivery costs. In contrast, January-March this year. 21 amid strengthening iron start of the year, although domestic scrap, excluding Furthermore, an ore levels. Meanwhile, rates of growth slowed VAT, averaged at $48 per additional incentive to scrap’s premium to MPI fob significantly in June. tonne below CIS MPI in importing metallics, in Black Sea fell to just $5 per A rise in stocks in the flat 2018. contrast with the situation a tonne on August 21, which steel sector has been more The high mill operating decade ago when China also should calm demand for moderate than in the long rates and price attractiveness demonstrated an increased merchant metallics as scrap steel supply chain, and we of MPI compared with scrap appetite for imports, has becomes price competitive. calculate that the HRC market helped encourage imports of been the virtually But infrastructure was in surplus conditions only MPI, which reached 1.21 non-existent inflows of investment announcements in January and February and million tonnes in the second ferrous scrap from abroad. made in recent months by returned to a deficit after that. quarter, while China imported close to zero the Chinese authorities are The speed of the drawdown of hot-briquetted iron (HBI) tonnes of scrap in 2019 and expected to result in an inventories in April and May reached 786,923 tonnes in H1 2020, while imports additional 30 million tonnes thanks to strong demand the period. This took total peaked at 4.25 million of steel demand this year. meant that the size of the iron metallics imports to tonnes in the second quarter This is likely to benefit rebar deficit was the largest since at almost 2 million tonnes in of 2009. consumption the most least 2013, supporting the the second quarter of 2020, Meanwhile, iron ore among steel products and price uptrend of the recent which was an all-time imports have been strong provides upside risk for months. quarterly high, with the this year, with second- steelmaking raw materials. previous peak in the third quarter arrivals rising by Analysis by Marina Maliushkina, quarter of 2009 when 19% year on year, partially Analysis by Alexander Kershaw, Fastmarkets MB metallics imports reached driven by high blast furnace Fastmarkets MB

In this section, Fastmarkets MB’s research team summarize their in-depth reports to highlight key factors driving the markets and their short-term price forecasts. We provide several regular services dedicated to the ferrous markets, providing independent analysis, price forecasts and supply and demand forecasts. Request your free sample of these services – www.fastmarkets.com

16 | Metal Market Magazine | September 2020 Since 1978, the LME has been the home of trading The home of for the aluminium industry. Our aluminium contracts provide comprehensive hedging and trading opportunities to companies aluminium throughout the value chain – from primary aluminium to alumina, alloys and premiums. As part of our commitment to drive a more trading sustainable future for metals, we plan to add a new scrap aluminium contract, and the opportunity to access low-carbon aluminium on our new spot trading platform. Whether you are a producer or consumer, a trader or a hedger, the LME provides the necessary tools you need to manage your price risk. lme.com/aluminium

SETTING THE GLOBAL STANDARD

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LME_FP_CMYK_Ad_Options_FINALAW.indd 1 23/08/2020 12:12 Profile NORSK HYDRO NORSK

18 | Metal Market Magazine | September 2020 Hilde Merete Aasheim ‘A company cannot be profitable in the long term if it isn’t sustainable’ Along a path leading from learning early about the practicalities of running a business during summer-holiday work to her present role, as CEO of major Norwegian aluminium and energy company Norsk Hydro, Hilde Merete Aasheim has faced many challenges and seized multiple opportunities. She discussed her journey with Fastmarkets’ Andrea Hotter

When Hilde Merete Aasheim were, Aasheim said, “a good go to work in the orders started working in the metals family”. department, then the salary and mining industry, she did not Her mother – who turns 100 department, and then in finances. think she would need to become this month – stayed at home to You don’t get that close when you quite such an expert in crisis bring up the children. Aasheim’s do a master’s degree – you go management. Yet during the father, a languages and only to the university and don’t past decade, the chief executive humanities teacher who had do the practical work,” Aasheim officer of Norwegian aluminium fought in the Second World War, said. and energy company Norsk was a huge influence on her as she As well as understanding a Hydro has found herself helping grew up. “My father had a strong business from top to bottom, she to lead the corporate response personality in the sense that he learned a lot from the bakery to a global financial downturn, a worked in the resistance group CEO, Svein Arne Næss, about paralyzing cyber-attack and the fighting for the freedom of leadership. “He taught me a lot Covid-19 pandemic. “Good at Norway and was imprisoned for about engagement: he had his picking a crisis? I’ve only been that. He taught us a lot about white clothes on to prepare the in difficult moments!” she fighting for what you believe,” breads even though he was CEO, laughed. she said. “He was the sort of and then he would come to us Aasheim had not planned a person with integrity in all while we did the orders,” she said. career in metals and mining: aspects – acting as a good citizen, “He also taught me about being a initially, she had wanted to follow being disciplined and a good visible leader and appreciating in her father’s footsteps as a person – so I have a lot from him, people on the floor, because that teacher, as her older sister had. or at least that’s what people say.” was what it was all about – Born in 1958 in Larvik, a small During each summer holiday ‘Good at preparing the products and town a 90-minute drive south of for seven years, Aasheim worked picking a crisis? sending them to customers at Oslo, Aasheim was the youngest in a local bakery. “I started on the I’ve only been 6am. I have high regards for my of non-identical twin sisters with floor putting the sugar on the former boss there and still have a brother and sister four and 14 cakes, but then after a while the in difficult contact with him today,” she years older, respectively. They CEO of the bakery wanted me to moments!’ added.

September 2020 | Metal Market Magazine | 19 Profile

Promoting green aluminium the right market segment, but it’s also a lot about people,” she Aasheim was running the Primary Metal expanding its recycling activities – it has added. division when Hydro launched its two invested in sorting and shredding technology At that time Elkem was very low-carbon aluminium brands, Circal and as well as developed the technical influenced by US aluminium Reduxa. The series has proven increasingly competence to bring scrap back into the producer Alcoa, with the two popular; its Circal brand has almost sold out, furnace, Aasheim noted. companies having an aluminium Aasheim said, noting a surge in demand for Aside from a consumer push to use more joint venture. Aasheim was later the material in the past 18 months. sustainable products, there is also a a plant manager for the Reduxa is Hydro’s series of low-carbon- regulatory drive. In Europe, which aims to Mosjoen, Norway aluminium emission aluminium, produced by using be climate neutral by 2050, a European smelter which was part of the hydroelectric power and with a maximum Climate Law has been proposed as part of a Elkem JV. carbon footprint of 4.0 kg of carbon dioxide Green Deal to turn the political commitment “I had the privilege of working per kg of metal – just a quarter of the global into a legal obligation and a trigger for closely with Paul O’Neill, then average. Circal is a range of products made investment. Alcoa CEO, and participated in with a minimum of 75% of post-consumer The Covid-19 pandemic has also led Alcoa’s executive leadership recycled content, significantly cutting governments around the world to place programme in the 1990s – I energy use and pushing the carbon footprint sustainability at the heart of their recovery could talk for several hours to below 2.3 kg of carbon dioxide per kg of plans – initiatives that are supported by the about that!” she said. aluminium as a result. United Nations and the Organisation for “That was perhaps the most Creating a larger closed-loop for Economic Cooperation and Development exciting period in my career, to aluminium is a key reason why Hydro is (OECD). be in charge of a plant – to really have responsibility for the Næss was extremely proud because if the company did well people and their safety, to when Aasheim was announced as the local society did well too. I deliver on time to customers; Hydro CEO; he baked a large also had a fascination with the that was really getting close to cake and jokingly claimed some engineers being able to transform the business,” she added. ownership of her success. raw materials into something By 2002, Aasheim had been Aasheim enjoyed school so that was needed.” named head of Elkem’s silicon much that she advocated for metal division, one of its main attending on Saturdays and From Elkem to Hydro business areas at the time. And created her own classes with the A few years later, Aasheim then she got a call from Hydro children in her street, teaching joined Elkem, which was CEO Eivind Reiten, who ran the them with books borrowed from founded by Sam Eyde, a company from 2001 to 2009. her father. But she changed her Norwegian engineer and “He offered me the job of head of mind about teaching as a career industrialist who also founded leadership and culture in Hydro. when one of her cousins went to Hydro. Starting in 1985 as a But I wasn’t that interested in a study business and opted instead financial controller, she became staff position, so I said I didn’t for business school in Bergen, on Elkem’s first female director want to waste his time and that it Norway’s west coast. after a few years. wasn’t the right thing for me. So With a bachelor’s degree in “I was then asked to be the Eivind said, ‘Why don’t you Public Accounting and then a head of Human Resources, and come and have a coffee?’” master’s degree in Business at that time I was pregnant with Aasheim recalled. Administration under her belt, my first child. I had to say to the Norwegian conglomerate Aasheim’s first job after CEO I had a very important Orkla ASA had just taken over graduating was at former delivery to make and could not Elkem and the company was accounting firm Arthur accept!” she laughed. “But when delisted from the stock Andersen, where one of her key the announcement of the birth exchange. Reiten was very client groups was the processing was made in the newspaper, persuasive. “It was the perfect industry in Norway, and in which it was back then, a big time for Eivind to ask me to join particular Elkem. bouquet of yellow flowers was Hydro, which I did,” Aasheim Almost immediately, she was sent to the hospital with the note added. hooked. “There I was, auditing attached saying, ‘Will you take She joined Hydro in October plants in small locations in the job?’ Three months later I 2005 as executive vice president Norway, and I got this fascination was on the corporate ‘I developed for Leadership and Culture, a with the waterfalls being used to management board of Elkem, role that encompassed human produce something that was heading up HR,” she said. a fascination resources, health, environment, needed – ferro-silicon, silicon Aasheim spent eight years in for local safety and corporate social metal, ferro-manganese,” she the role, business-orienting the communities responsibility. told Metal Market Magazine. HR function. “I have a lot of that had a joint Hydro had just exited the “I developed a fascination for interest in people. I see that fertilizer business, Yara, and was local communities that had a business is about strategy, destiny with firmly in aluminium as well as oil joint destiny with the company, producing the right products to the company’ and gas. Aasheim knew nothing

20 | Metal Market Magazine | September 2020 about the energy business at the ‘My heart manning numbers!” she laughed. with her along with multiple time, but that was something But instead, the pair asked her to consultants. The new company that was to quickly change. was in my take the lead on the integration started operations as “I had asked the CEO if he fascination for and planning for the merger. StatoilHydro in October 2007, could give me some advice waterfalls and Aasheim was given an hour to subsequently changing its name coming into Hydro, and he said decide. She called her husband to simply Statoil in November that in order to succeed in a staff metal plants’ and made the decision to accept 2009. position, you need to be relevant. the role. In the summer of 2008, In aluminium I could be relevant Two days later, the biggest however, Hydro CEO Reiten because I knew the business, but merger in the Nordics was called her again. “He said to me in oil and gas, I needed to learn,” announced and Aasheim was that when he first recruited me, I Aasheim said. “So, I went to the named as Head of Staff except hadn’t been that interested head of the oil and gas business Financials based in Stavanger, because I wanted a line position, and said, ‘Here I am, could you the Norwegian headquarters of and now he could offer me that. please help me learn about oil the new Statoil. She was also on He asked me to be Head of and gas?’ It was a risk for me – he the merged entity’s corporate Primary Metal.” could have said, ‘You should have management board. It was a hard decision. thought about this before you In order to be credible, Typically staying for years in a joined Hydro!’” Aasheim realized as she accepted role “because I’ve always enjoyed But only a week later, Aasheim that she would have to leave what I was doing,” Aasheim really was offshore, working on an oil Hydro and go with the new liked working with Lund. So, she platform; she followed this with a company. “One advantage was made a list of the pros and cons of geology trip to Scotland, learning that I was almost neutral – I had leaving StatoilHydro. “I realized how to extract oil, and then a only been in Hydro a year, and if that to go into a line position in stint on the company’s oil and they had taken a person who had oil and gas would be a tough call gas trading desk. She was deeply worked with either company for in the sense that I would have to impressed at the competence years, it would have been too step down from the corporate needed to explore for and extract one-sided. I was able to look at management board in order to oil and gas, a lesson that she had what represented the best from learn, and to run an oil rig or learnt in metals at Elkem and each company and take that something, which would be very which has continued in forward, instead of favouring one different. I still felt my heart was aluminium at Hydro since. over the other due to loyalty,” she in my fascination for waterfalls “Even though I am a financial noted. and metal plants,” she said. person, I have a high regard for Focused now on purely oil and It was difficult to tell Lund she the critical processes and really gas, the integration was a big job. was leaving. “I felt I had a lot to focus on this in the business Aasheim had 200 people working do still there. It had been good for systems today,” she said. But after around a year, the Hydro corporate management board started to realize that its oil and gas business “was too small to conquer the world,” Aasheim said. “We were fighting head to head with Norway’s Statoil over a large project in Russia at that time,” she added. In December 2006, Statoil and Hydro’s oil and gas business came up with a plan to merge. Aasheim, who was still head of Leadership and Culture, was going in and out of the two companies’ negotiations team meetings to provide them with the manning numbers. The deal was still not public. Two days before the merger was announced, Aasheim was Aasheim says she called to a meeting with Hydro has a high regard for CEO Reiten and Statoil CEO the critical processes Helge Lund. It was a Saturday, and really focuses on

and Aasheim’s first thought was, this in the business HYDRO NORSK “I’ve really screwed up the systems today

September 2020 | Metal Market Magazine | 21 Profile

me to have a different background [metals], because I challenged cost levels,” she noted. “Some of the Statoil corporate management board shook their heads and said, ‘Hilde, are you going to melt aluminium and leave this billion dollar business?’ But I had been working in aluminium for more than 20 years at that time, and I accepted,” she added. Global financial crisis When Reiten met with Aasheim to sign her employment contract, London Metal Exchange aluminium prices were $3,000 per tonne and Hydro was set to expand its Karmøy operation. Three months later when she rejoined HYDRO NORSK Hydro, LME aluminium was Investing in cost cutting opportunities were start to contribute,” she said. $1,400 per tonne and, after advanced smelting found by the teams and people at Sustainability is integral to the three weeks, Aasheim went to technology is a all levels of the organization, not strategy, and is in step with the Karmøy to prematurely close key part of Hydro by me,” she added. It was an opinions of consumers, the plant’s old Søderberg strategy example of the leadership style particularly young people, as well potlines. that Aasheim believes in – as investors and the company’s It was a baptism of fire into the setting direction but also own staff, she noted. “A company role. Hydro had “serious engaging people, “because cannot be profitable in the long problems,” she said. “I had to do people are willing to contribute term if it isn’t sustainable – if a lot of cost cutting, but also if they understand why.” A you’re not able to demonstrate curtailing – 25% of our smelting decade later, when Brandztaeg that you are producing in a capacity – and after a while, I retired, Aasheim became Hydro responsible way with as low a realized we simply had too high CEO. carbon footprint as possible, and costs,” she added. By now, you can project that the footprint Aasheim was working closely New agenda is getting lower and lower,” she with Hydro’s new CEO, Svein When she took the helm of told Metal Market Magazine. Richard Brandtzæg; Reiten left Hydro, Aasheim met with its Hydro has a target of reducing Hydro in April 2009 to become board and investors and took the its already-competitive carbon Chairman of forestry products view that profitability – at Hydro dioxide emissions in its own company Norske Skog. and across the broader production and processes by a She established a programme aluminium industry – had been further 30% by 2030. designed to reduce Hydro’s too low for too long. She spelled Sustainability is also about smelter costs around the world, out a new corporate programme: responsible mining, through the first by $100 per tonne of metal ‘lifting profitability, driving entire supply chain; for example, produced by the end of 2011, sustainability.’ Aasheim is currently engaged then with an expansion to $300 The strategy targets an with a project on safe tailings per tonne by the end of 2014. improvement programme of disposal at the International “To start with, people thought I NOK7.3 billion ($1.36 billion) by Council on Mining & Metals, was crazy. But I spent a lot of 2023, and is front-loaded, with plans to replace historical oil and time in the initial programme NOK2.7 billion ($0.5 billion) coal-based production in Brazil demonstrating what current coming from getting back to full with gas and electrification costs were and what the target speed in Brazil, where the respectively, and is focused on was, to show that there was company has faced various issues reforestation across its potential – and not just in the in recent years. The company is operations. traditional areas but also in on track to deliver its NOK4.1 The company is also seeking procurement, logistics, so that billion ($0.76 billion) target for alternative, non-landfill uses for everybody could be engaged in 2020, she added. “Some people residual tailings and is even looking for opportunities perhaps choked on their coffees, exploring whether it can avoid within their own departments,” but I wanted everyone to realize tailings entirely, Aasheim noted. she said. what the current situation is, “The entire supply chain matters, “Eventually those potential because when they realize, they and we should be in a good

22 | Metal Market Magazine | September 2020 position here because we are in ‘People are plants in Shanghai and Suzhou in methodology of how to behave the whole value chain and have a China. But it was “not something and coordinate through a crisis lot of competences. We have to willing to that would be left in China,” as makes it easier to get an defend and promote aluminium contribute the company had initially overview of Covid-19 quickly, as a material, and sustainability is if they thought, Aasheim said. understand the critical points very much about that,” she said. As the virus spread around the and then act based on those Hydro is a member of the understand world, the company’s operations learnings. “You have to prepare Aluminium Stewardship why’ across 40 different countries for the worst and hope for the Initiative (ASI), a global, multi- were impacted, particularly its best. If you only hope for the stakeholder standards-setting downstream business, where best, then you’re not prepared,” and certification organization. 30% of capacity was reduced at she added. The company now has the longest one stage as demand slumped in unbroken chain of ASI key end-use markets such as Surviving cyber attack certifications in the industry, transportation, housing and Hydro’s crisis preparations had from mining through refining construction. Its upstream actually included several and primary aluminium operations largely continued as training exercises for a potential production to fabrication of normal. cyber attack. But even then, end-products. “We [Hydro] are very good at Aasheim said that you can’t According to Aasheim, handling crises. During the imagine what it is like until you profitability is not just about cyber-attack we saw an are in the midst of it: “You’re EBIT, but also about how a extraordinary effort in an almost blindfolded. You have to company uses its cash and capex. extraordinary situation, and it’s be as prepared as possible and This led her to announce a goal the same for Covid-19,” she told then you have to improvise for over-the-cycle return on Metal Market Magazine. By the along the way.” capital employed (ROCE) of time Covid-19 reached Brazil, When Aasheim first heard 10%, up from 6% in 2019 and where cases have been extremely that Hydro was the victim of the lower in prior years. “We had high, Hydro was able to use the metals and mining industry’s never announced the ROCE lessons it had learnt from its first publicly disclosed cyber target externally before, and I experiences elsewhere to rapidly attack, she did not believe it was wanted to put that out there very deploy initiatives to mitigate the real. The phone woke her in visibly, making sure that we situation. Oslo, Norway; it was 4am, and allocate capital in areas we’ve had “There are two priorities – the her appointment as the very high profitability in the past absolute first is the health and company’s new CEO had been and avoid allocating capital in well-being of our employees and announced the prior day. “I areas where returns have simply their families. That has been very answered, and a voice said, been too low,” she said. clear, and we’re doing our utmost ‘Hilde, we are under serious Based on this, the company has to reduce the spread of the virus cyber attack. This is not an defined strategic goals for its inside the plants and also helping exercise. You had better come to different business areas; it will outside. But at the same time, we work.’ I wondered, is this a joke, sustain and improve, but not also want to keep the wheels is someone testing me?” she necessarily grow, its upstream turning as best as we can,” she recalled. business, and invest further in added. It was neither a joke nor a test. renewables, batteries and The company is expecting Using relatively new recycling. The company’s push weak end-use markets for some ransomware known as into renewables comes as it time, Aasheim said, with a high LockerGoga, hackers had recognizes growth in that sector level of uncertainty on how and infiltrated the company’s as well as a desire to diversify into when the economy will pick up, systems globally, impacting its an emerging megatrend where it whether the various stimulus 170 sites and 35,000 employees can use existing strengths, efforts will work, and whether around the world. The company Aasheim said. This includes there will be another wave of immediately took the decision batteries in recycling and Covid-19. “In some areas we not to pay the bitcoin ransom transportation, wind power in don’t expect a pick-up until 2023 and went public with the news of Norway and solar energy in or 2024,” she added. the attack. It is a move that won Brazil; it will not include a move Despite the benefits of the Hydro accolades from the into mining other raw materials various improvement security industry for its like lithium or cobalt, although it programmes, the company has transparency. could involve recycling them, she frozen capex, issued bonds and This allowed a forensic team added. suspended its dividend as – including technology precautionary measures to providers – to thoroughly remap Coping with Covid-19 preserve cash in the event that and learn from what happened, When the Covid-19 pandemic the pandemic and its impacts are tracking backwards to see how initially emerged, it shuttered felt for some time. the hackers moved around the Hydro’s three extruded-products Aasheim said that the system and confirming how

September 2020 | Metal Market Magazine | 23 Profile

sophisticated the attack was. It She recalled an industry meeting needed to take care of the turned out to be something of a after which the CEOs were children,” Aasheim said. Trojan horse: the hackers had asked to group together for an “That was also the first time I chosen their ‘patient zero’ – an official photograph. Taking her heard about sustainability. She email conversation with a Hydro place in the line-up, the set the scene very early on – not customer – months in advance. photographer asked her to leave just in her work as Environment The virus was eventually placed it as the shot was “only for the Minister, but also in her later throughout the Hydro system CEOs.” work at the World Health and launched by a code. The industry needs to deal Organization – in establishing By affecting the company’s with this kind of bias by that economic development and ability to access its systems, the promoting equality as a value, bringing people out of poverty attack also impacted industrial she said, “which is not only is part of sustainability. It was production at some of Hydro’s about gender but also about an interesting learning for me sites. Fortunately, energy, race, age and background, and has always been brought bauxite and alumina managed to because we need diversity,” she with me,” she added. run as normal, while the primary told Metal Market Magazine. Aasheim said her own metal plants also continued as “We have different experiences have demonstrated usual with a higher degree of backgrounds, and we bring more that natural resources can offer a manual operations. The rolled collectively to the table than if variety of roles. “Perhaps I have products operations meanwhile we were all the same as each been fortunate with the people I were mostly back to normal other,” she added. worked for, but having said that, within a couple of days. Aasheim said where you are you also have to sacrifice Badly affected, however, was based also plays a huge role in something in order to be in a Hydro’s extruded solutions facilitating the return of women position where you’re seen and business, which relies on highly to the workplace after are promoted,” she said. specialized customer-specific childbirth, with Norway having “I have had very good support data being fetched from the a good set-up for families and from my husband over the years servers detailing what to some areas, such as the USA and – we’ve helped each other, and produce. As a workaround, any Brazil, having shorter maternity he also had to sacrifice. orders that the company had leaves. “We have a lot of work to Hopefully that is easier now access to on paper had to be do, and the industry can help to than it was during my manually punched into the go beyond the law. In Hydro, we generation, or even the one systems. Once these were have more space to do that,” she before me,” she added. Aasheim fulfilled, production had to said. “The industry is quite good met her husband, Tom Erling, stop. at bringing young women in, but in high school in her hometown Although Hydro’s cyber by the time we look to recruit at 18 years old; the childhood defenses are industry-standard, them as middle managers, some sweethearts have been together the company is not reticent of them have already gone.” for over 40 years since. The about the likelihood of another From the outset, Aasheim’s couple have a son and daughter, attack in the future and it has father instilled a strong sense of “who are now grown up and of redesigned and strengthened its regard for the role her mother whom we are very proud.” systems accordingly. For played and made her believe In her spare time, Aasheim Aasheim, it is only a matter of firmly in equal opportunities. walks a lot. She lives close to the time. “We are sharing our “We always had this notion that woods and uses this as the experience as industry players we could do what we wanted to opportunity to refresh her will become victims of future do and there was equality in the mind, or even prepare a speech cyber attacks, whether it is us or gender sense,” she said. or presentation in her head. She someone else,” she said. Another key inspiration for also reads, and in the winter Aasheim was Norwegian prime goes cross-country skiing, Women in commodities minister Gro Harlem which is a skill she learnt when As one of very few female CEOs Brundtland, whose influence she was small. “It’s like riding a in metals and mining, Aasheim was twofold: she was a bike – once you know how to do is very conscious of the need to successful politician and mother it, you never forget!” she said. push for greater gender ‘You have to of four, as well as one of the Her children are “definitely diversity within the industry. prepare for the earliest proponents for not in metals” – in fact, her son “There’s a real business case for worst and hope sustainability. “She worked hard is a famous comedian in Norway tapping into the entire as a minister to create working for NRK, the workforce – women make up for the best. If kindergartens as something that Norwegian government-owned half the population, so why you only hope is offered to all as a public radio and television public shouldn’t we utilize that 50% of for the best, service. For her that was a broadcasting company. the recruitment base?” she said. business case for Norway – we “Performing for the company Even as Hydro CEO, Aasheim then you’re not needed the females to come to annual party? That I have said is has experienced gender bias. prepared’ work, so it was obvious someone a no-go!” she laughed.

24 | Metal Market Magazine | September 2020 Aluminium Steady global aluminium supply despite low demand

This has been a much more challenging year for the global aluminium market than Global primary aluminium production has many had anticipated, with the Covid-19 seen limited curtailment, despite dented pandemic resulting in a big hit to aluminium demand across the world. But demand caused by the Covid-19 pandemic, while demand continues to be sluggish as the virus continues to spread, aluminium reports Myra Pinkham supply has largely remained in place, given the cost of idling capacity, Yang Cao, stating, “Our industry has been hit by the pandemic,” Pal Kildemo, vice a senior research analyst for Fastmarkets supply and demand shocks on a scale never president and chief financial officer of MB, pointed out. He noted that this has seen before.” Norsk Hydro ASA, said, noting that while resulted in a large surplus. “The Covid-19 pandemic has been a every year brings something new, this year “Although the pandemic should bring hugely disruptive event, imposing a has been a little bit more extreme. “We negative sentiment to the market, multilateral shock to the global economic aren’t sure what the fourth quarter will aluminium prices have been ahead of system,” Sucden Financial noted in its bring, but we believe there will be stronger market fundamentals this year,” Cao latest quarterly metals report. As a result, demand than we experienced in the pointed out, attributing “the massive Geordie Wilkes, its head of research, said second quarter,” he said. liquidity injected by governments” that, he global demand for aluminium has been Cao estimates that total world said, has resulted in more hot money very weak. However, he said that it is hard aluminium consumption was 15.264 flooding into the financial market, pushing to quantify just how much aluminium million tonnes in the second quarter of up financial assets’ prices. The LME daily consumption will be down this year, 2020, down by 7.7% from 16.53 million official price closed at $1,755.50 per tonne especially given that the staggered tonnes a year earlier. Chinese aluminium on August 20, up from $1,621 per tonne a approach to the pandemic-related consumption during the quarter was month earlier. lockdowns around the world could cause down by 4.2% year on year to 9.315 “Also, aluminium has been riding on the discrepancies between different regions million tonnes and second-quarter coat-tails of the rest of the base metals and different countries. aluminium demand in the rest of the complex, particularly the copper market, That is even though in all the major world was down by 12.1% to 6.345 million which is fundamentally tighter,” John regions of the world – China, Europe and tonnes from the like quarter in 2019. Mothersole, director of research for IHS the US – there has been a decline in activity Meanwhile, he expects that for full-year Markit’s pricing and purchasing service, in just about all manufacturing and 2020 global aluminium demand will be said, noting that this is supported by some construction spaces, which Michael down by 7.2% from 2019’s level, with encouraging data relating to copper Widmer, a metals strategist for Bank of China witnessing a 3.5% year-on-year coming out of China. “Broadly, base America Merrill Lynch (BAML), said decline, while aluminium consumption in metals and other commodities are reading caused aluminium demand to fall the rest of the world declines by 12.0% to what is happening in China as a template everywhere. In fact, he maintained that the 24.82 million tonnes. of what is likely to happen around the rest only aluminium end-use sector that “We have seen some signs of of the world and pricing that in,” he showed at least slight improvement was improvement in the last couple of explained. “But I believe that is a packaging. But even that has been months, supported by the fact that there mischaracterization of what the somewhat of a mixed bag, with foil and have been fewer lockdowns and more aluminium recovery will look like.” other packaging products used in homes stimulus measures being injected across Since the current price rally has mainly seeing better demand than general the globe,” Wilkes said. But he is been due to speculation, Cao said that packaging for food products, with more uncertain how much such movement in aluminium prices could gradually retreat meals being cooked at home during the the second half of the year will offset the toward the end of the year to match the pandemic. losses that had been incurred in the first market fundamentals, although, in 2021, Jakob Stausholm, Rio Tinto’s chief half or if demand will simply plateau, as demand recovers, prices should recover financial officer, pointed that while the especially given that he believes that as well. aluminium industry was already facing much of the recent stimulus measures are “We are in unprecedented times,” some fundamental challenges coming into unsustainable over the long run. Jean-Sebastien Jacques, Rio Tinto’s chief 2020, the Covid-19 pandemic has added “It is clear that the Covid pandemic will executive officer said during his company’s another pressure point for the industry. be with us for some time,” making it recent first-half earnings conference call, “Most people were taken by surprise by difficult to say with absolute certainty what

September 2020 | Metal Market Magazine | 25 Aluminium

the shape of the recovery will be, Jacques the stimulus measures aimed at the US manufacturing activity has started to said, explaining that big questions remain construction sector, particularly pick up, as can be seen by the US Institute over the trajectory of consumer spending infrastructure construction, have been for Supply Management (ISM) globally and the rate of reopening country working, the problem is that Chinese manufacturing purchasing managers by country, as well as the risk of a second or sentiment is still pretty fragile, and with index (PMI), which not only returned to even third wave of virus occurring. concerns about its asset bubble the expansionary mode in June, but government has decided to step back continued to rise to a reading of 54.2% in China’s recovery some of its previously announced stimulus July. “But the recent pickup in Covid The rate of recovery has been varying measures. cases has resulted in a very fragile and region by region, Cao observed, with “But we are starting to see some growth precarious situation in the North market conditions improving in China come back into the market, which is very American aluminium market," Jean while the rest of the world continues to be positive for aluminium demand,” Wilkes Simard, president and chief executive hit quite severely by the Covid-19 said, noting that Chinese land sales were officer of the Aluminium Association of pandemic. Mothersole said this is not up by 36% year on year in May, with Canada, said. surprising given that China was the first property starts increasing by 2.5%. “But Wilkes noted that US aluminium country to be affected by the pandemic, that is coming from a very low base,” he shipments were down in the first half, the first to go through a lockdown and the pointed out. including a 34% decline year to date first to open up again. “They have Mothersole noted that the Chinese through May for extruded production and appeared to have done a good job in monetary and fiscal stimulus measures a 28% year to date decline for flat roll, controlling the spread of the virus and have been supporting growth of targeted largely due to the two-month lockdown of their relaxation measures that rebooted investments for high-speed rail, a big user US auto plants. Cao said that Fastmarkets their economy have been proceeding of aluminium rolling stock, and for electric MB is forecasting overall US aluminium reasonably well,” he said. grid interconnections, including in demand to be down by 12.7% for full year As a result, the pace of Chinese investments in transmission lines that use 2020, before recovering by about 10% next aluminium demand began to pick up again, aluminium cables. “China has also recently year. This, he said, comes as US automotive starting in the second quarter even lowered electricity tariffs 10 to 15%,” sales continued to slump even though stronger than the market had expected, which, he said, is helpful for aluminium automakers restarted their operations in Kildemo said, largely attributing that to a production there. mid-May. combination of pent-up demand, Simard said there has been a decline in government stimulus across various Meanwhile in the Americas demand for value-added aluminium end-use markets, including construction There has also been some improvement products – not just in North America but and transportation equipment, and some recently in aluminium demand outside throughout the world – forcing most aluminium stockpiling measures, which he China, Roy Harvey, president and chief smelters to make more P1020 commodity said has resulted in a greater metal executive officer of Alcoa Corp, recently ingot and less value-added product in order oversupply situation than the market told investors during the company’s to keep their operations going and to avoid dynamics would indicate. second quarter earnings call. He stated potline disruptions. He noted that while even in China most that some high-level manufacturing and The impact on aluminium producers, end-use markets continue to lag 2019 aluminium end-use market data showed however, was somewhat offset by increases levels, that is not the case in the auto some signs of improvement in both the US aluminium content in North American sector, where, in addition to pent-up and Europe starting in May and June, vehicles, with automakers continuing to demand, subsidies for both electric supported by a recovery in manufacturing look to lighten the weight of their vehicles vehicles and for autos in general has been activity there, especially with US auto to increase fuel economy and to lower stimulating consumer demand. In fact, plants getting back to work in mid-May. greenhouse gas emissions, Matt Meenan, a according to the China Association of “A full recovery, however, will take a little spokesman for the Aluminum Association Automobile Manufacturers, Chinese auto longer than expected,” BAML’s Widmer said. He pointed out that not only has the production increased by 6.3% month on said, predicting that it won’t be until aluminium content per vehicle been month and 22.5% year on year in June on sometime in 2021 that demand outside of increasing year after year, but a new survey the back of a 4.8% month on month and China will get back to normal. Others say conducted by DuckerFrontier indicates 11.6% year on year increase in sales. it could even take longer than that. that the average content will grow to 514 Kildemo noted that the production of Kildemo said that Hydro has become pounds per vehicle by 2026, which is up by more electric and hybrid vehicles is more concerned about demand in North 12% from 2020 levels. particularly positive for aluminium, given and South America, where, while there has US demand for aluminium for the need to lightweight those vehicles to not been a second wave of the pandemic packaging applications has been positive compensate for the weight of the battery yet, there has been a longer than expected this year. Meenan said US can stock and to increase their range. first wave, which could mean that the shipments have been positive this year, China’s building and construction Americas are at high risk for the pandemic rising 6.6% year on year in June. Kildemo sector has also been recovering strongly, to be extended. said that demand for aluminium foil is although, while Chinese construction While in the US aluminium demand even stronger than for can stock. starts were up by 3% year on year in May, has recently been picking up, Wilkes said Wilkes said that the US construction Wilkes said that year to date they that he believes that the reopening up of sector is starting to improve, especially remained 13% below those during the first some businesses there could have been residential construction, with US housing five months of last year, despite recent premature and that there have begun to starts rising by 22.6% in July to its highest government stimulus. He said that while be some issues because of that. production rate since February. However,

26 | Metal Market Magazine | September 2020 the uncertainty in the market has caused overall construction spending to tail off in recent months, and there is concern how it will fare going forward, especially for non-residential projects. Europe has also been hit hard by the pandemic, and despite strong stimulus measures aluminium demand there is still weak, Wilkes said. Conditions have started to improve as European countries come out of lockdown, although at differing rates country by country. He said that while France and Italy saw upward growth in June, Germany continued to see some declines. “Overall European demand has been a worry, especially in the auto sector where registrations were down 24% year on year in June and sales were down 56.8% in May,” and with the European manufacturing PMI remaining contractionary. While there is some hope for a brighter fourth quarter in TINTO RIO Europe, Wilkes said that he does not expect Total global primary aluminium output in 2020 looks set to be similar to last year’s output to see much growth on a year-on-year basis during the third quarter. a number of US aluminium imports, throughout this year, with very little including primary metal and various primary aluminium capacity having been Trade issues lurk consumer goods. idled, partly due to the cost of doing so. While trade issues have recently been Simard also contested the reasoning for Cao is forecasting global primary overshadowed by the pandemic, they do this move, which was a reported surge in aluminium production will only be down continue to be of some concern, Canadian aluminium imports into the US. by 0.1% this year before rising about 3.5% particularly the re-escalation of trade While he admits that Canada increased its in 2021, resulting in about a 4.1 million tensions between the US and China coming imports of P1020, he said that is not the tonne global surplus. at a time when the recently negotiated case for its total aluminium imports into “Everyone is pointing to China to do Phase 1 trade agreement has not yet taken the US. more to control their overcapacity effect. “But while I would expect that going Tom Dobbins, Aluminum Association situation,” Mothersole said, but he said it forward China and the US will go their president and chief executive officer, also is making decisions based on its best separate ways more and more,” BAML’s expressed disappointment in this decision, interests, to support its economy and Widmer said he does not believe that the stating, “This Groundhog’s Day revival of specific industries. “I think that even they market has been all that worried about that. Section 232 tariffs on a key trading partner recognize that there is too much Nevertheless, given that the US does not address the underlying issue of aluminium capacity and production, but presidential election is coming up in China’s overcapacity.” politically they are right now unwilling to November and questions of whether China “This move is expected to be make hard decisions,” he said, although will indeed fulfill some of its purchase devastating for US downstream producers they might have to in order to avoid trade pledges in the agreement, citing and end-users,” Cao said, given that they actions to isolate China from the rest of extraordinary circumstances, Mothersole will not only need to pay the tariff but also the market. said a big question is whether the Trump the higher US Midwest premium. Many There have been some curtailments of administration might “blow up” the others agree, including an Alcoa capacity. Kildemo observed that there have agreement at some point. spokesman, who said, “Implementing been some small ones in North America, Another controversial trade issue has these tariffs on a vital, free-trading partner Argentina, New Zealand and Europe, as been the Trump administration’s decision will cause unnecessary disruption for well as about 600,000 to 700,000 tonnes in to reinstate 10% Section 232 tariffs on downstream producers across North China, “But that is less than is needed in US imports of P1020 commodity America and further distort the market.” light of the falling demand.” Simard noted aluminium ingot from Canada shortly after A Rio Tinto spokesman said this move that the closures in China were replaced by the US-Mexico-Canada Agreement undermines market confidence in secure new capacity. (USMCA) replacement to the Nafta trade supplies of aluminium in North America “We aren’t sure what the third and pact, which Simard called “the poster child and is a distraction from implementing fourth quarter will bring to the aluminium of the US administration,” went into effect. the USMCA, while a Hydro spokesman market,” Kildemo said. “We are cautiously He called this move “a political oxymoron” said any actions taken should be made in optimistic that there will be stronger that adds a new layer of uncertainty to an line with WTO regulations. demand than we experienced in the second already uncertain business environment, quarter, but we are also well prepared for especially given that the Canadian Production rolls on things to weaken again given that the government is now considering retaliatory Even with the weakness in demand, pandemic is still spreading actively in some measures – a dollar-for-dollar 10% tariff on production has remained pretty high parts of the world.”

September 2020 | Metal Market Magazine | 27 Aluminium Unlocking India’s potential

The bane of the Indian aluminium industry remains imports taking a major India’s aluminium industry has started to bounce share of the domestic market, which has back from the lows of lockdown demanded by robust growth potential. This is in spite of the country having built sufficient the Covid-19 pandemic and its long-term primary aluminium smelting capacity, backed by more than adequate alumina potential remains strong, reports Kunal Bose refining capacity and bauxite mining upstream, to meet most domestic requirements. handicapped by the government not Ahead of the exercise, the government The immediate past chairman of the refunding a slew of local duties that add up had asked manufacturing industries with National Aluminium Company (Nalco), to nearly 15% of metal production cost. significant export profiles, including Tapan Chand, said: “The ownership of The levies, including VAT, coal cess, aluminium and steel, to submit claims for 3.896 billion tonnes of bauxite and 290 mandi (market) tax and duty on electricity refund rates backed by audited data. In billion tonnes of thermal coal and, in the and fuel used for transportation, have its submission under the RoDTEP pre-Covid-19 times, the local demand for eroded the competitiveness of Indian scheme, AAI has asked the government the metal growing at an annual rate of up to metal when exporters in other major to consider a refund rate of 13% for 9.5%, make India the ideal center to build producing countries, especially China, do aluminium exports as it believes that: smelting capacity. That is why between not carry any such burden, said a “duties and taxes should not be exported Vedanta, Hindalco and Nalco we currently spokesperson for the Aluminium as such. Instead these should be remitted have capacity of 4.1 million tonnes.” Association of India (AAI). back to domestic producers to encourage During April 2019 to March 2020, Despite this handicap, India did domestic value addition” for export. under the combined impact of a manage to earn $5.7 billion from exports Ahead of the launch of RoDTEP, for year-long slowdown in major user of primary metal and aluminium which dates have not been fixed, AAI industries such as electrical, automobile products during 2018-19, which wants enhancement of MEIS benefit to and building and construction, plus the constituted 1.3% of total Indian 5% for all aluminium exports with Covid-19 triggered lockdown of merchandise exports of $330 billion. But immediate effect. economic activities in the final week of competition from countries where An industry official said: March, Indian aluminium demand slid by sources of energy are comparatively “Washington’s decision to levy a 10% 6% to 3.7 million tonnes. Imports in low-cost hydroelectric power and natural duty on aluminium imports from India synchronization with demand were down gas, unlike coal-fired electricity in India, while giving exemption to a number of by an identical margin to 2.170 million saw the country’s income from countries which together have nearly tonnes from 2.318 million tonnes in aluminium exports fall by 11% to $5 50% share of the US import of the metal 2018-19, but these still had a share of billion in 2019-20. In a submission to the has put us on the back foot. Moreover, around 58% of the Indian aluminium government, AAI said the Indian our aluminium exports to the US have market, according to Hindalco managing industry had the capacity to “double now the further disadvantage of an director Satish Pai. foreign exchange earnings” to over $10 additional 2.6% to 6% duty following Even while production of the domestic billion a year if it is supported with Washington denying India the benefits of industry remained around 3.7 million “return of unremitted duties and taxes to generalized system of preferences.” tonnes, under the pressure of imports, exporters which will be in conformity What is encouraging the industry, domestic sales were down to 1.550 with best global practices.” however, is that New Delhi has finally million tonnes from 1.654 million tonnes Under the existing merchandise exports recognized aluminium as a “champion in 2018-19. An industry official said that from India scheme (MEIS), aluminium is sector” with potential to be counted domestic producers are always keen to entitled to just a 2% refund rate of among global leaders and a major sell primary metal and rolled products in unremitted taxes. To the relief of the supplier of the metal in the world the local market, which fetch them better industry, there is now recognition in the market. New Delhi believes that the prices than when they export. Import government that MEIS needs replacement souring of political and trade duty and freight are embedded in local by a liberal scheme called remission of relationships between China, which has prices. duties and taxes on exported products more than half the share of world (RoDTEP) for promotion of exports. aluminium production, and the US and Taxes and levies RoDTEP, a scheme to reimburse exporters its allies will come to the aid of Indian With imports continuing to have a of aluminium and some other items for industry to step up exports. Moreover, dominant share of the Indian aluminium some duties and taxes paid, got Cabinet some tensions between China and India market, local producers are left with no approval in March. Under the scheme, an in recent times have made the Indian option but to sell large quantities abroad inter-ministerial committee will decide the government firm in its resolve to curb to keep smelter capacity utilization at a rates and items for which reimbursement imports of several items from its high level. They are, however, then of duties and taxes will be made. northern neighbour. The list includes

28 | Metal Market Magazine | September 2020 items from electronics to medicines to strike a balance between the demand of capital expenditure programme for the steel and aluminium. primary producers and the interest of current year to focus on smelter and Abhijit Pati, chief executive officer of employment-intensive secondary refinery maintenance and whatever is Bharat Aluminium, part of the Vedanta aluminium manufacturers spread across required to complete the 500,000 tonne Group, said: “Aluminium stands to the country. Scrap generation within the expansion of its 1.5 million tonne benefit in the government’s pursuit to country being limited in the absence of a refinery at Rayagada in Orissa this year. keep the trade balance in check when the scientific collection system and a vehicle No signals are coming from Nalco as economy is facing a major crisis due to scrappage policy, our reliance on imports yet that it is ready to take up for the long run of the fatal coronavirus. remains unavoidably high,” said an implementation its planned 500,000 While confidence is growing that New official of government think-tank Niti tonne brownfield expansion of the Delhi will be liberal in returning duties Aayog. The unemployment rate in the 460,000 tonne smelter at Angul in and taxes paid in the course of making country being too high at around 10% Orissa, where it also has plans to create aluminium to exporters, it is also because of the impact of the coronavirus an extra capacity of 100,000 tonnes by expected to address at the same time the impact on the economy, it is unlikely that upgrading the potline current of four issue of enabling the domestic industry the government will immediately put operating potlines to 220 kA from 180 to have progressively a bigger share of additional duty or any other barriers on kA. Nalco has, however, secured major the local market. Imports having a sway scrap imports. New Delhi will also not statutory clearances, acquired land, of nearly 60% of the Indian aluminium overlook the “very significant energy appointed consultants and awarded long market is a disincentive to build new saving involved in scrap recycling,” said delivery contracts for machinery and smelting capacity.” the official. equipment for building a new 1 million “But some recent reforms of the tpy alumina refinery stream alongside its Scrap imports minerals sector are indicative that the 2.75 million tpy complex in Orissa’s In addition to the concerns in India about government has identified aluminium as Damanjodi. The new stream will be the levels of international trade in one industry where abundance of bauxite based on Rio Tinto’s “improved aluminium, there is a continuing and coal resources could make the medium-pressure digestion technology.” controversy between primary and country less and less dependent on Chand has a different take on secondary aluminium producers over the imports with some help from the expansion in difficult times like now. growing import of scrap in particular. government as exports are scaled up. For “The advantage of undertaking Primary producers want restrictions on facilitating the creation of new smelting expansion at a time like this is that you arrivals of foreign-origin scrap by raising capacity, New Delhi is preparing the engage consultants at favourable rates import duty on it from 2.5% to 7.5%, as is ground for joint auction of bauxite and and book machinery and equipment at charged on finished metal. Demands are coal mines,” said Pati. discounted prices. Your investment is also being made that the government In an earnings call, Hindalco’s Pai said secured by domestic aluminium demand should ensure that aluminium scrap that if there was an aluminium demand growth potential,” he said. imports containing lead or radioactive growth rate of “6% to 7%, then in five The industry certainly had a rough materials do not find their way into the years we will end up importing a lot of time in the first quarter (April to June) of country. The safety of public health the metal. So you have this joint auction 2020-21, when domestic aluminium demands that producers of utensils are move to encourage investment in new consumption slid by as much as 57% to barred from using secondary metal made smelting capacity.” 433,000 tonnes from 996,000 tonnes in from scrap of questionable quality. Pati the corresponding period of last year. believes that since the government has Room for expansion? According to industry officials, demand already issued quality control orders to How fast aluminium demand will grow destruction in all major user segments put a stop to imports of substandard in the post-Covid-19 period will largely following the long lockdown resulted in steel, it is only a matter of time before it be decided by the pace at which the the industry’s year-on-year sales in the does the same for aluminium scrap. government rolls out infrastructure domestic market falling 55% to 186,000 Chand said sharp rises in Indian scrap projects as well as the size of official tonnes. Imports too were down by 58% imports in recent periods are a result of stimulus for construction, building and to 246,000 tonnes. China putting a high tariff wall on automobile industries, said a Such a major shrinkage of domestic US-origin aluminium scrap and also spokesperson for the Confederation of sales made the industry an aggressive classifying it as a restricted import item. Indian Industry. Whatever the present seller of primary aluminium and India, with a significantly large aluminium demand and price-related products in the world market. That the secondary sector consisting of over problems, a number of industry officials first quarter would be a washout was a 3,500 units, has become the target will bet on the Indian aluminium market given, but how will the rest of 2020-21 market for global traders who earlier sold becoming “10 to 12 million tonnes over pan out? Pai said: “We are seeing Indian scrap to China. India’s scrap imports the next decade.” But whether for and global demand for aluminium rose in value to $2.467 billion in 2018-19 aluminium or steel, in the prevailing coming back. All our plants are from $1.4 billion in 2016-17. Scrap has a business environment, the focus of operational and customers are picking share of around 58% of India’s leading Indian groups is to cut up the metal and value added products. aluminium imports. production costs, conserve cash and Moreover, government stimulus It is expected that a much higher postpone expansion to a future date. programmes have come to the aid of the customs duty and rigorous checks on Pai said: “Hindalco at this stage is not market. The second quarter will be quality will lead to a reduction in scrap looking to expand.” The country’s most strong for us and so will be the next two imports. “But the government has to valuable aluminium producer has cut its quarters.”

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BOF Tuning Kit_209x274_e.indd 1 05.03.20 09:30 Global Awards for Steel Excellence 2020 Winners Global Awards for Steel Excellence 2020 WINNERS he lights on Broadway are dark. Most restaurants are United, which is already demonstrating results and enormous closed. The glittering hotel ballrooms are empty, and value for the entire supply chain.” Tthe silence in New York City is almost deafening. Another first-time entrant was Bull Moose Tube, whose But despite the lack of a ballroom filled with hundreds of Mark Abernathy said that with the development of the people in festive attire and high spirits, there were shouts innovative HydroLogic product “entering the awards with a of jubilation from at least some of the many participants new product gave us the opportunity to see if people in the on the Zoom call that announced the winners of the industry think our work is innovative. And as the winner of Fastmarkets Global Awards for Steel Excellence 2020. With the Best Innovation - Product category, I guess they do!” the planned June 2020 Global Steel Success Strategies Cronimet Envirotec of Germany submitted two entries – conference moved from an in-person event to a digital one each in the Best Innovation - Process and Raw conference in October, the awards were presented on July Materials/Consumables categories – and won both 23 on a call attended by people from around the world. categories as a first-time entrant. Dr. Filipe Manjolinho “It is very satisfying that notwithstanding the coronavirus Costa, executive director, explains that the firm was challenge that we can recognize these companies now looking for validation of its work by a professional, rather than wait for October and the Steel Success Strategies international jury to assess its technology and its conference,” said Alex Harrison, editorial and pricing innovativeness. “Receiving two awards in those categories director, metals and mining, for Fastmarkets. “Awards such is a great honor, which shows us that our recycling as these serve many purposes, not the least of which is to technology is recognized across borders and industries. shine a spotlight on companies and people who deserve Winning these two awards shows us that we are focusing recognition for their striving to improve. After all, that search on the right market and customer base with a value- to be better or best, and through that to offer better value, creating recycling service.” lies at the heart of all successful businesses.” And previous entrant and winner Reliance Steel & The 2020 awards saw 90 finalists, about 70 from the Aluminum Co. said that winning the large service center Americas complemented by a strong group of international category “for the second year in a row is a meaningful endcap businesses from across the world. Consequently, this year’s to our 80th anniversary commemoration,” said Stephen awards were more global in scope, and new categories Koch, senior vice president, operations. “This award boosts sought excellence in automotive suppliers, workforce morale, especially during these unprecedented times. It diversity, ferrous trading, exchange company - ferrous, and underscores that Reliance has been doing the right thing. We production/processors/fabricators. will continue to do so for the suppliers, customers, employees There were quite a few first-time entrants this year, and and communities who rely on us.” their reasons for submitting a nomination varied. For In addition to the 2020 award winners, also recognized example, for Greg Leidner, chief executive officer, Merfish was John Ferriola as Industry Advocate of the Year. Ferriola, United, timing was everything. “It was an absolute honor to who recently retired as chairman and chief executive be selected as a finalist for this prestigious award, and to win officer of Nucor Corp., spent more than 40 years in the U.S. the Mergers and Acquisitions category sends a truly positive steel industry and was “a trusted thought leader for the message to our customers, suppliers and our employees on industry,” said Philip K. Bell, president of the Steel the value of bringing these two storied companies together. Manufacturers Association. From the 100-year history of Merfish Pipe and Supply and the Nominations for the 2021 Fastmarkets Global Awards for 40-year history of United Pipe & Steel, we created Merfish Steel Excellence will open in October 2020.

September 2020 | Metal Market Magazine | 33 ANNOUNCING OUR LATEST BREAKTHROUGH

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1819 Clarkson Rd. Chesterfield, MO 63017 | 800.325.4467 | BULLMOOSETUBE.COM Global Awards for Steel Excellence 2020 Winners

Best innovation – Product » Bull Moose Tube A smooth tube for sprinkler pipe and more

Seizing on the opportunity to develop a hydraulic characteristic not available with low-carbon steel sprinkler pipe that standard carbon steel sprinkler pipe. mirrors the advantages of stainless steel Such a high C-Factor, however, would – but without the higher costs for both only be attained by a pipe with an the manufacturer and the user – earned extraordinarily smooth surface. Bull Moose Tube the award for Best Consequently, Bull Moose’s product Innovation – Product. development evolved around a new HyrdoLogic is a low-carbon pipe for the spatially optimized diffusion alloy, sprinkler industry that harnesses recent permanently bonded to the steel’s TUBE MOOSE BULL metallurgical innovations to provide a surface. variety of ‘what if’ scenarios to meet the more durable pipe with a smoother flow Once Bull Moose committed to the exacting regulations administered by for water in fire-suppression systems. alloy-layer strategy, the company needed agencies such as Factory Mutual and Creating a sprinkler pipe with a C Factor to ensure that the alloy-coated surface Underwriters Laboratories, among of 150 ensures an ultra-smooth surface would remain smooth under pressure and others,” said Abernathy. for both the interior and exterior over time. Standard sprinkler pipes can The development of HydroLogic is a diameters. Product development exhibit a loss of pressure during years of win-win for both the company and its centered on a new spatially optimized installation when corrosion develops, customers. Bull Moose enjoys the diffusion alloy, which is permanently because of the frictional interference significant cost advantages of having an bonded to the steel’s surface. caused by rough, corroded pipe walls. The alloy layer on a low-carbon steel core “It has been about 50 years since any new product was subjected to intensive, versus the expense of stainless steel major changes were made to the sprinkler accelerated corrosion testing, which used products. The new product so efficiently pipe product line. With recent both hot-condensing humidity testing handles water that some customers can metallurgical developments and in and ASTM B117 salt fog testing. This specify a smaller diameter pipe, thus wanting to challenge the status quo, we accelerated corrosion protocol revealed providing savings on pipe, associated looked at ways to improve efficiency and that the new pipe maintains a C value of at hardware and labor. The new product also long-term performance while avoiding least 150 throughout its life, and the alloy helps reduce pressure loss experienced on stainless to remain price competitive,” layer provides high corrosion resistance higher floors of multi-story buildings, said Mark Abernathy, manager of field on both the inner and outer diameter which can potentially spare the expense of operations for Bull Moose Tube, a surfaces with less resistance and pressure an additional pump/pressure booster. subsidiary of Caparo Bull Moose, Inc. loss. Bull Moose Tube plans to expand the Bull Moose Tube was founded in 1962 “Once we designed, produced and HydroLogic line with additional products with headquarters in Chesterfield, tested HydroLogic within Bull Moose offering end-users even more corrosion Missouri. Today the firm operates eight Tube, we then had to have it approved by resistance than currently experienced. manufacturing plants throughout the various regulatory bodies. Regulations “We are looking to move into applications United States, employing about 500 staff governing water sprinkler systems are currently captured by stainless products producing about 750,000 tons of tubular among the most rigorous in the country such as conduits and handrails. We think products per year. because of their need to perform as there are other ways that our unique Bull Moose set out to produce a designed to protect people and buildings. product can be utilized in our everyday low-carbon steel sprinkler pipe with a We had to prove its performance in a life,” Abernathy said. metallurgically bonded, diffusion-alloy layer that would achieve three parallel goals. First, the firm wanted to design a product with inner-diameter hydraulic characteristics similar to those of stainless steel. Secondly, corrosion resistance characteristics comparable to stainless steel were needed on both the inner and outer diameter surfaces, and, thirdly, the product had to allow for fabrication methods comparable to conventional black sprinkler pipe. “All three objectives were achieved with the development of HydroLogic,” Abernathy said. Development of HydroLogic took about two years. Bull Moose employed various testing procedures to determine that the new technology attains a superior TUBE MOOSE BULL

September 2020 | Metal Market Magazine | 35 Global Awards for Steel Excellence 2020 Winners

Best Innovation – Process » Cronimet Envirotec Enhancing technology to recycle a broader range of metals

Since its founding in 2013, Cronimet distillation process, it is possible to mining anew by reusing some of the Envirotec GmbH has been utilizing recycle up to 100% of the input material waste stream,” Costa explained. leading-edge vacuum distillation while separating it from all The briquetting plant is capable of technology to re-use stainless steel contaminants without adding any producing 50,000 tons annually, and waste materials generated by the metals chemicals,” Costa said. the vacuum distillation plant can and oil and gas industries. As its But a major leap forward for the process up to 20,000 tons per year. technology expanded, so did Cronimet company and its customers came in Supporting both processes are a new Envirotec’s innovation, which resulted 2019 with the installation of technology storage facility and a laboratory, which in the 2019 installation of a briquetting to create metallic-rich briquettes from both opened in 2019. The laboratory facility to process metallic fines and powder and dusts. The briquettes facilities provide faster metallurgical dusts. Those innovative technologies reduce the need for solid scrap in the analyses and further ensures the quality helped the German firm win the Best production of stainless steel and of the briquetted product. Innovation – Process award in this provide “a much greater use of The vacuum distillation and year’s Awards for Steel Excellence. byproducts and thus avoiding the costs briquetting processes have been “We have received a lot of feedback and environmental impacts of disposal. enthusiastically accepted by Cronimet from the market about how our By using an innovative binder, it is now Envirotec’s customers in Germany and technology is solving common issues possible to produce raw materials that neighboring countries: “We are already and helps reduce waste balances while can be used in making stainless steel. working on being able to process a increasing sustainability,” said Dr. For example, by using our briquettes, a broader scope of materials. This entails Filipe Manjolinho Costa, managing producer can avoid the costs associated different types and sizes of materials, director of Cronimet Envirotec. with purchasing newly mined materials. their fluidity and other criteria. “Resources are re-used, and we have From a nickel sludge we can reclaim Furthermore, we are looking to expand already been awarded with the resource nickel ores and pure nickel instead of our portfolio of metals that we can efficiency award and two reclaim from waste streams and innovation awards in Germany. make them into usable materials Entering the Fastmarkets to lower costs and avoid awards competition allowed our environmental impacts. Today work to be evaluated by a our focus is on stainless steel professional, international jury bearing waste and byproducts. to assess our technology and its However, we are actively innovativeness.” In addition to working on being able to winning the Best Innovation process materials with a base of – Process category, Cronimet tin, zinc, iron, copper and many Envirotec was also named Raw more,” Costa said. Materials/Consumables In addition to expanding its Provider of the Year. “Winning work to include other metals, these awards shows us that we Cronimet Envirotec is also are focusing on the right market eyeing work beyond its current and customer base with a geographic focus of Germany value-creating recycling and neighboring countries and service.” expanding elsewhere in Europe As the firm grew, so did its and to North America. Also on technology and its ability to the horizon is an expansion of handle stainless steel wastes. In the firm’s recycling services to 2013, when Cronimet Envirotec other industries. “By treating began operations in Bitterfeld- not only wet, oily and mostly Wolfen, Germany, its business hazardous materials but also was focused on processing fine dry powders, we are able to grinding and metal sludges and recycle a lot more materials oily mill scale with vacuum than before. This means that we distillation technology. The can now offer a solution for outputs – metal powders and oil companies that, for example, – were then recycled back into produce metal powders and their consuming industries to have a vast amount of rejects as reduce waste, reduce the carbon well as blasting abrasive footprint and lower costs for the producers in need of disposal or

users. “With our vacuum ENVIROTEC CRONIMET recycling,” said Costa.

36 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Best Mergers & Acquisitions » Merfish United Creating a nationwide US tube & pipe supplier

Early in 2020, two large master pipe distributors combined to form a new national powerhouse. The century-old Merfish Pipe & Supply, based in Houston, merged with 40-year old United Pipe & Steel, based outside Boston, to create Merfish United. One Equity Partners has majority ownership of the combined company, which claims primacy as “the largest master distributor of standard pipe in the United States.” The combined company is also an innovator in route-based less-than-truckload (LTL) delivery, which ensures regular resupply. There have been discussions on and off among Greg Leidner, chief executive officer at legacy United, Gerald Merfish, and One Equity since 2013. The stars finally aligned this year. Legacy United was founded in Ipswich, Massachusetts in 1980. Nathan Merfish founded his eponymous company in Houston in 1920. It survived the Great Depression and prospered as east Texas became not only the hub of oil and gas UNITED MERFISH production, but also of oilfield goods and services. Leidner is now CEO at the Leidner explained, “but also helping them offerings. “We will do some cutting to combined company. with risk management in a heavily length,” said Leidner. “And we can do roll The two operations complemented each commodity-based business. The cost of grooving at our Houston facility.” other in geography, materials handled, and pipe is based on the cost of hot-rolled coil. That depth and breadth was on display suppliers. Legacy Merfish was a master The price of copper tube has been very with a recent custom order. “We handled an distributor of carbon-steel welded and expensive and very volatile lately.” PVC export job for a desalination plant for the seamless pipe supplied from mills around pipe has been less expensive. West Bank [of the Jordan River, in Israel]. It the world. Legacy United was a master “Our bread-and-butter business is was project funded by the US Agency for distributor of carbon-steel standard pipe, as carbon-steel pipe up to 24 inches in International Development. We supplied well as copper tube, supplied from mills in diameter,” said Leidner. “Also copper tube miles and miles of pipe, cut to length. For the US. It also supplies polyvinyl chloride up to six inches in diameter, PVC up to 16 that special order we worked directly with (PVC) pipe, strut, threaded rod and inches diameter, as well as PVC and metal our mill supplier as well as with the conduit. conduit for electrical lines. That is all wholesaler. It was a multi-million-dollar Both organizations offered a just-in-time primarily for the construction market.” shipment out of the port of Camden, New replenishment model. That is intended to Back upstream at the mill end of the Jersey.” allow their customers, distributors and supply chain, Leidner said that the combined In another aspect of flexibility and service centers to improve their cash flow company will lean toward the legacy United coverage, Merfish United does not have a by maintaining high rates of replenishment practice of relying on domestic sources as mother ship facility. “We generally have our and minimizing their exposure to much as feasible. “We prefer to purchase operations sized for the markets they serve,” commodity swings. from US mills if at all possible. We have said Leidner. “We have a large warehouse in “The real value proposition is to allow our relationships that go back decades and we Easton, Pennsylvania, that serves the customers to lower their inventory levels,” rely upon those for quality and support.” Northeast, which is one of our larger said Leidner. “Their customers, the There are geographic graduations to the markets. The warehouse in Houston is also contractors, are notoriously bad at supply chain. “As we get farther south and quite large, as is the market in Houston.” planning,” which has usually meant that the west, there is more prevalence of imports,” Merfish United serves almost the entire distributors who supply them have to hold Leidner noted. continental U.S. and has a strong presence large inventories. “What we do allows them While some distributors and service throughout California. To cover its vast to hold lower inventories by offering centers have started light manufacturing and territory, the company designed its own replenishment in two days or less.” finishing in recent years – things like bending route-based LTL delivery system under “It’s not just a matter of enabling them to and threading – Merfish United is focusing which every facility gets a delivery at least be more efficient with working capital,” its energies on logistics and breadth of once a week; and some twice a week.

September 2020 | Metal Market Magazine | 37 STEEL REVOLUTION

Marcegaglia is proud to have won 2020 Global Awards for Steel Excellence for Best Operational Improvements, thanks to the Tensil-Pro system, and for Information Technology Services Provider of the Year, in collaboration with Fives for Smart Line project.

These awards are the result of the strategic role that Research & Development has taken on in the Marcegaglia Group in recent years, focused on the continuous improvement of processes and the development of innovative solutions.

We want to thank our R&D team and all our Group for these great achievements that enable us to be considered pioneers of continuous in-line solutions.

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Get our app www.marcegaglia.com Global Awards for Steel Excellence 2020 Winners STEEL Best Operational Improvements » Marcegaglia Ravenna SpA REVOLUTION On-line evaluation of tensile properties of strip

Marcegaglia Ravenna SpA produces higher productivity and lower energy Magazine about two further important high-quality galvanized products, mainly for consumption. developments of Tensil-Pro during 2020. Marcegaglia is proud to have won 2020 Global Awards the automotive market. Over the last five – Metallurgical investigation. Qualitative The first was measurement of the austenite for Steel Excellence for Best Operational Improvements, years, Dr. Antonio Marcegaglia and Dr. and quantitative comprehension of the phase fraction formed during thanks to the Tensil-Pro system, and for Information Emma Marcegaglia prompted a new metallurgical mechanisms affecting steel high-temperature annealing treatment strategic role for R&D, focusing mainly on properties during industrial production adopting new equations, the basic theory for Technology Services Provider of the Year, in collaboration the continuous improvement of processes/ routes. which was published in the March 2020 with Fives for Smart Line project. products and on the development of – Industry 4.0. The system can help to edition of La Metallurgia Italiana. innovative solutions. digitalize industrial processes fully (hot The “second breakthrough innovation” To monitor the process and its rolling, cold rolling, annealing etc.) since then has been in the system’s These awards are the result of the strategic role that metallurgical effect on final products, Tensil-Pro is applicable to all steels, ‘self-training’ algorithm. “The training of technology for on-line tensile and including single-phase, multi-phase, ferritic mathematical models is quite fundamental Research & Development has taken on in the Marcegaglia microstructural properties evaluation was and austenitic. It can also be applied to other, and requires a huge amount of costly work Group in recent years, focused on the continuous developed for both hot rolled and cold rolled non-ferrous, metallic-alloy strips, including comprising thousands of tensile tests and improvement of processes and the development of strip. Marcegaglia had noted that plants aluminium and copper. correlation analysis,” he explained. “For previously lacked devices to achieve that The system comprises a rolling mill stand Tensil-Pro, a new algorithm was conceived innovative solutions. with high sensitivity to current process or skin-pass mill or a tension-levelling that completely overcomes these conditions – a lack that also applied to the machine to act as the physical sensor for the difficulties. Practically we defined an evaluation of non-magnetic metals, such as tensile-microstructure properties. Its algorithm that makes automatically the We want to thank our R&D team and all our Group stainless steels, aluminium and copper. software uses a complex mathematical training of model parameters without the for these great achievements that enable us to be The company’s Tensil-Pro system model based on fundamental equations for use or need of laboratory tensile tests,” he provides non-destructive on-line evaluation the cold rolling mill process, in which the explained. In this way, Tensil-Pro can be considered pioneers of continuous in-line solutions. of tensile properties in terms of yield stress material properties and the roll/strip installed and put into operation and tensile strength, and additional interaction are evaluated by means of a set of immediately, rather than requiring months important microstructural features such as original constitutive equations whose or even years, he noted. grain size, austenite phase fraction formed in parameters are determined on the basis of Ferraiuolo added that Marcegaglia is a continuous annealing line, and laboratory microstructure and tensile test using Tensil-Pro in a cold rolling mill to recrystallized fraction. The system can be results. As inputs, the mathematical model evaluate hot rolled strip tensile and installed on a skin pass mill for CAL/HDG receives several online process parameters microstructure properties in order to product monitoring (process, from high-sensitivity measurement devices. slightly tune the system, thanks to microstructure and tensile) and/or a cold Examples of applications include: the additional metallurgical mathematical rolling mill stand for hot band qualification skin-pass line for hot rolled strip; pickling models, the HDG processing conditions (microstructure and tensile). lines (skin-pass or tension leveler); cold coil by coil and to achieve quite uniform Implementation of Tensil-Pro in four rolling lines (tandem, reversible or single tensile properties in the final products. “We HDG lines and two cold rolling mills at stand); hot-dip galvanizing lines (skin pass); are using Tensil-Pro in the skin pass of four Marcegaglia Ravenna SpA significantly and continuous annealing lines (skin pass). CGL lines for evaluation of the strip tensile improved operational efficiency of the whole Tensil-Pro allowed fast development of properties of final products. The system is production process by increasing capability AHSS grades (from DP500 up to DP980) on used for all steel grades (AHSS, HSLA etc.) to deliver products to customers in a HDG line No. 4 at the Marcegaglia Ravenna and strip thickness/width,” he added. cost-effective way while still ensuring high plant. Advantages included: improvement He said that the relationship between the product quality. The company reports that of average productivity by about 5%; hot area process with the cold area Tensil-Pro improved production costs, continuous acquisition of tensile properties processing of steel is quite strong and that u u enhanced product performance, enabled of the hot rolled strip for each steel supplier the only way to investigate that is by analysis of quality/process trends, achieved (by using Tensil-Pro in a cold rolling mill); adopting measuring devices. He added that a predictable process, provided cause and and optimization of the annealing process the Tensil-Pro system demonstrated effect analysis, and provided effective conditions. Tensil-Pro also enabled excellent sensitivity both on hot rolled and support in industrial trials. understanding of the metallurgical evolution cold rolled strip. “This tool gives the Marcegaglia reports that Tensil-Pro and physical mechanisms occurring during opportunity to process-people and enables: the industrial transformation of hot rolled metallurgists to develop new advanced o – Product qualification. Evaluation of strip down to final cold rolled products. third-generation steel grades in a very short tensile properties combined with Many factors were used to calculate the time,” he explained. “Finally, and for me microstructural features for magnetic return on investment, including the rapid this is the most interesting evolution, the and non-magnetic materials. and cheaper development of new products. Tensil-Pro system is the basic tool for

Get our app – Process efficiency and cost savings. The Overall, an ROI of more than 5% was integration of different processes, from hot online tensile-structure properties estimated. to cold area, through the implementation of evaluation allows very quick Alessandro Ferraiuolo, R&D manager at AI for the effective automation of industrial www.marcegaglia.com optimization of the process, achieving Marcegaglia Ravenna, told Metal Market production,” he concluded.

September 2020 | Metal Market Magazine | 39 ADVERTISEMENT FEATURE We’re in the business of making business easier - especially now With the cyclical nature of the metals industry, flexibility and attractive cost of capital. ABLs can a strong balance sheet, ample liquidity and the provide working capital financing, to finance ability to react quickly may be the surest insurance acquisitions and investments, to provide for success and survival. Supply and demand turnaround or debtor-in-possession financing, considerations and commodity price volatility and to recapitalize businesses including the coupled with the continuous quest to lower establishment of employee stock ownership costs and improve key measures of performance plans (ESOPs). provide a perfect breeding ground for success Digital transformation and making it easier – or failure. But with the uncertainty caused by for our clients to do business with us are key today’s events, businesses need to look at the areas of focus for Bank of America. We offer a market forces and internal drivers of performance full suite of digital tools that provide speed, as the means to best manage their businesses. accuracy and real-time data on key financial The metal industry was already facing information. Our CashPro™ application is challenges before the worldwide pandemic; a secure method for signing treasury, trade and, for many companies, it only exacerbated and deposit documentation. Likewise, issues these companies were facing. Positioning Intelligent Receivables application uses for success and survival takes planning as well as artificial intelligence to reconcile receipts the ability to quickly respond to real time events. Ira J. Kreft while the Accounts Payable Optimization uses One of the keys to long-term success is data analytics to enhance working capital. having the appropriate capital structure in developed PeerProfiler™, a database of And the Application Programming Interfaces place because this helps enable companies to information aggregated from thousands of present data from multiple sources in a single take advantage of opportunities and survive companies based on our worldwide clientele. place to present a clear and concise view of during challenging times in the industry. A Discussing PeerProfiler™ results with clients financial fundamentals from multiple sources strong balance sheet, with low to moderate shows them opportunities to focus on such key and conform to “open banking” standards level, adequate liquidity, good working elements of their capital structure, including instituted by many countries. capital management and excellent operating working capital management, operating Although as humans we value personal performance metrics are hallmarks of this. efficiency and debt capacity to support relationships and connections, we can also Competitive benchmarking, which involves organic growth or strategic acquisition. These expedite many business transactions by comparing a number of metrics for your discussions are essential to maintaining a viable using digital tools that provide speed while company to its peers, enables a company to business as well as growing one. minimizing errors. The opportunities of today see how it is doing, including areas where it is The PeerProfiler™ goes beyond financing or may become the challenges of tomorrow, doing well, as well as areas for improvement. capital-raising strategies and shows treasury and the speed of necessary transactions can Two key considerations are who do you want and other solutions that can be developed help protect your business as conditions can to be benchmarked against and obtaining the to reduce costs and create new working deteriorate or enhance your business as the benchmarking information. Benchmarking capital strategies. Included is a sensitivity market rebounds. against public companies can be insightful; but, analytics model that shows financial impacts Contact one of our bankers today, or visit for some companies, it may not be a relevant from changes in payables, receivables and our website at bofaml.com/business capital for comparison or the larger company might be inventory. All of the PeerProfiler™ attributes more information. in other markets or lines of business, making can help businesses better anticipate changes a comparison difficult. We find that the most facing their businesses and plan accordingly to successful businesses benchmark against their minimize turbulence and maximize results. Ira J. Kreft - Senior Vice President competition to identify their opportunities for For many metal industry companies, Bank of America advantage. an Asset-Based Loan (ABL) is the preferred Phone: (312) 992-6113 To determine how well your company financing structure for a company’s senior credit Email: [email protected]. compares to its competitors, Bank of America facility because of their covenant-lite nature, Visit bofaml.com/businesscapital to learn more.

Disclaimer: “Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured • May Lose Value • Are Not Bank Guaranteed. © 2020 Bank of America Corporation. All rights reserved. 3202755

40 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Financial Services Provider of The Year » Bank of America Innovative finance for challenging steel markets

Bank of America is not only one of the leadership. For over thirteen years, funds, invest excess liquidity and view world’s leading financial institutions, Bank of America has been the No. 1 Left account balances in real time, including but one that has been a key financing Lead Bookrunner for syndicated through the CashPro Mobile app, which partner for both the steel industry and asset-based credit facilities, with a 29% gives clients a way to interact with the other metals sectors for over 40 years. It market share in 2019. It also has a bank through a mobile platform when describes itself as a company that has substantial market share in they are not in their office. Kreft noted been consistently customer focused, non-syndicated and sole-lender that the company has just rolled out a dedicated to make its customers financings for both ferrous and new version of that portal to make it financial lives better and is continuing non-ferrous metals companies. more interactive. to keep its eyes open for ways to help its Kreft noted that through the Another tool that Bank of America steel clients to continue to be successful investment banking side of business, uses to assist its clients to improve or despite the business environment. Bank of America has done some change their business is its Ira J. Kreft, senior vice president, advisory work related to both recent PeerProfiler™ benchmarking software, Bank of America, recognizes that the transformational acquisitions and which leverages the bank’s proprietary steel industry is very cyclical, often changes in certain metals companies’ company database to create client and moving from being in success mode to corporate structure. “In some cases, we prospective client advisory survival mode year to year and that use our balance sheet to provide capital presentations. Kreft said that this tool currently, largely due to the Covid-19 commits and to lend money to can help Bank of America to advise pandemic, companies are worried about companies,” Kreft explained. There are companies – especially privately owned what the future might hold, including also instances when Bank of America businesses – about how they are whether there could be a return to the syndicates credit facilities to other performing relative to their peers lockdowns that occurred in mid-March. institutions or raises debt or equity without disclosing who those peers are. “Because of this we are doing capital for its clients through either “They can see what they are doing well everything we can to help them to private or public markets. and what they might need to improve,” improve their capital structure and Kreft said that the bank’s team he said, adding that the resulting liquidity and to provide them with approach, knowledge about the analytics and presentations generated insights about their business and the industry and the fact that it has an by this software are unique in the industry as a whole so they will not only ample balance sheet to support even financial services industry. survive through all of this but be more large companies, gives it an edge. “As a Given the volatility of steel markets, successful,” Kreft said. He noted that large institution we have a vast array of Bank of America also works with its Bank of America has recently brought resources and products. Our teams clients on hedging arrangements to out a number of new products and harness these resources and delivers manage price risk. Kreft said that Bank services to support all of its customers, them to our clients,” he explained. “We of America has also recently been ranging from individual consumers, to bring together institutional and market assisting more steel clients to tap into small- and middle-market businesses to knowledge for our clients.” the tax-exempt market, given that large corporations. Also, digital transformation is a key under federal rules and regulations Bank of America’s consistent focus, and has become an increasingly recyclers, including steel mills that use business strategy to be a good financing important strategy to make it easier for scrap and recycle it into a finished partner for all its clients through clients to do business with Bank of product, could use tax-exempt numerous business cycles saw it named America, especially in the current financing to fund either new steel plants Financial Services Provider of the Year. challenging business environment, or plant expansions. “As a large institution, Bank of Kreft said, noting that Bank of America “As the steel industry continues to America has a vast array of resources has made substantial investments to evolve, we will continue to work with and products,” Kreft pointed out, streamline, digitize and address client our clients as their financing partner to including a full array of banking, pain points. execute their strategies and to meet investment banking, risk management For example, CashPro, its leading their objectives,” Kreft said. “We want and wealth management solutions, global treasury platform, enables its to continue to make it easier for them to placing a big emphasis upon clients to manage their banking do business with us and to help them be environmental, social and governance relationship, make payments, receive successful in all business cycles.”

September 2020 | Metal Market Magazine | 41 MMM-ads-Aluminium2020-virtual.pdf 4 7/29/2020 3:35:17 PM

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• Match-making feature allowing you to connect with C the right person at the right time M • Exclusive content from high-level industry experts Y

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International Global Awards for Steel Excellence 2020 Winners Legal Services Provider of the Year » Wiley Aluminium 2020 Providing support to deter unfair international trade Wiley’s International Trade Team efficiently.” For example, US includes more than 50 people, including Administration thinking on country 21st - 23rd September | Virtual Event about 30 lawyers, dedicated international carve-outs is evolving: “Will that trade advisors, economic analysts, and happen or not?” Agreements on past former US government officials. quotas for steel imports to the US by Led by practice chair Alan H. Price, the country were set at steel demand levels team solves clients’ problems with a blend prevailing before Covid-19, so merit of legal expertise, trade policy thought Wiley has made much greater use of reconsideration now, with potential leadership, and public relations virtual meeting technology for remote impacts for Brazil, South Korea, Canada Covering the full supply chain from raw materials capabilities. Its partners are called on connections. For example, one of the and Mexico, Price noted. regularly by high-ranking Administration practical challenges that Wiley has through to end-use, you can take advantage of officials in the US to provide advice and overcome is remote participation in Enhanced capabilities counsel on innovative trade strategies and ITC Hearings, presenting cases and Wiley’s Trade Analytics Group, including these event features: policies. managing multiple witnesses to make economists, analysts and its commercial The law firm notes that in addition to legal arguments and provide testimony, team, is another area in which Wiley has new and innovative proceedings that have as well as handling Q&A with enhanced its capabilities: “We have set up transformed the engagement of trade Commissioners who can hear, but a more formal structure around that,” said • Match-making feature allowing you to connect with remedy proceedings for the US steel cannot necessarily see, those witnesses. Price. industry, Wiley’s traditional trade policy It has been a learning process to manage During its work on Section 301 as well C the right person at the right time and remedies work remains its that efficiently and “You have to know as Section 232, Wiley found that M best-known capability. your witnesses well,” Price pointed out. sometimes the wrong tariff numbers were • Exclusive content from high-level industry experts It highlights its excellent record of Many judgments on duties applied on applied to products shipped – something Y winning large, complex, and high-profile steel imports to the US during that has required additional work with US

CM • Host and join virtual roundtables AD and CVD cases on behalf of major US 2014-2017 have now become due for Customs and clients to get them right, industries, and points out that it is among sunset reviews, so they have been a Price noted. “Growth in the customs area MY • Unlimited virtual meeting rooms a limited number of practices that feature of Wiley’s work this year too. means that correct classification becomes

CY regularly serve as principal counsel for Section 232 has also been a much more important,” he stressed. for you to conduct your business major unfair trade investigations. continuing part of Wiley’s 2020 With an eye on the US Presidential CMY Wiley’s clients include large North activity. On behalf of two trade election due later this year, Wiley is also • Meet new and existing clients American steel producers and leading associations – the American Iron and positioning itself to be valuable to K American trade associations. The firm Steel Institute (AISI) and the Steel policymakers needing to understand in a secure virtual setting also plays a leading role in advising US Manufacturers Association (SMA) – Wiley’s clients’ concerns. “We are industry and the Office of the United Wiley drafted and filed an amicus brief planting seeds on Trade Policy,” Price said. States Trade Representative in numerous in support of the U.S. government’s He said that Wiley continues to be very World Trade Organization proceedings. decision to implement Section 232 steel busy on trade remedies based on Sections Wiley has extensive expertise in trade tariffs after it was challenged at the U.S. 232 and 301. US steelmakers continue to matters involving China. Court of International Trade (CIT) in object to government subsidization of the Register today American Institute for International steel industry in China. There is also the Operating remotely Steel, Inc., et al v. United States. Wiley question of how to address current In an interview following Wiley’s award notes that the CIT ultimately affirmed populist challenges to the fundamentals as Legal Services Provider of the Year, the government’s use of Section 232. of a liberal trade climate and policy, Price Price told Metal Market Magazine that Wiley filed another amicus brief on highlighted – a topic of importance to the Covid-19 pandemic has had a behalf of AISI and SMA in the appeal of companies and political parties in the US. significant impact on trends in Wiley’s these proceedings at the U.S. Court of While there is an accelerating need for work this year. As a consequence of office Appeals for the Federal Circuit (CAFC), investment in the US steel industry, trade shutdowns, facilitating the shift to which affirmed the judgment of the CIT laws continue to play a role in its success, operating remotely has been an essential on February 28, 2020. said Price. “US steelmakers fought for 40 development for both Wiley and the US Price said that Section 232 is an years to maintain a domestic industry, government, he observed. evolving tool for the steel industry: “We and that very aggressive approach has “We’ve worked with them and are have to work with what we have paid off,” he observed. “They have to be working to address problems arising from successful as businesses, but they also the government side,” he explained. He need support against unfair trade added that what was originally perceived 'Use of the law is part practices,” he added. as being a 2-3 month issue has actually of the tools of “We want to succeed for clients required modifying operational regardless of how things play out,” said procedures to make practical changes on competitiveness' Price. “Use of the law is part of the tools of a permanent basis. competitiveness,” he concluded. metalbulletin.com/events/alum September 2020 | Metal Market Magazine | 43 Danieli answers 06

to be ANSWER a step aheaD

Danieli Digimelter benchmark technology 15,000 heats per year at the lowest OpEx and environmental impact

Digimelter is the Danieli-patented technology with a unique combination of power, intelligence, and environmentally friendly equipment for the achievement of 15,000 heats per year with minimal OpEx, lowest environmental impacts, and high flexibility for raw materials.

The Q-One electrical feeder provides the highest power factor and very low network flicker due to real-time arc control. It achieves unprecedent high-power transfer thanks to independent control of arc current, voltage and frequency, for each electrode.

The Q-Melt intelligent controller runs EAF melting processes automatically, in a stable and adaptive way by making use of Q-Reg+ electrode regulator, Lindarc laser off-gas analyzer, and Melt-Model self-learning optimizer.

Zero-bucket concept is accomplished by the ECS continuous scrap charging and preheating system, for Twenty 09. Quality slab casters reduced environmental impact and enhanced energy Danieli answers 10. Pickling and cold mills saving. to be a step ahead 11. Galvanizing / Air knives 12. Billet casters 01. Sustainability 13. Billet welders Danieli EAF technology references include the recent, 02. CO2 reduction 14. Wirerod mills 150-ton EAF equipped with ECS at Guihang Metal 03. 4.0 intelligent plant 15. Rail and section mills Products, China, that achieved 36 heats per day, danieli.com 04. MIDA ECR 16. The Drawer sizing block 05. QSP DUE 17. Reheating systems equivalent to 12,000 heats per year, only two months after 06. Digimelter 18. Seamless tubes startup. 07. Energiron DRI 19. Extrusion lines 08. Long-life BF 20. Aluminium mills

Danieli_pagine_2020_esecutivi 418x274 Metal Market Magazine 07_24_.indd 6 18/08/20 18:09 Danieli answers 06

to be ANSWER a step aheaD

Danieli Digimelter benchmark technology 15,000 heats per year at the lowest OpEx and environmental impact

Danieli_pagine_2020_esecutivi 418x274 Metal Market Magazine 07_24_.indd 6 18/08/20 18:09 For you, our solutions redesign the future. Fives received the award as a Technology Provider of the Year for its ground-breaking heat treatment and real-time quality management technologies.

www.fivesgroup.com Global Awards for Steel Excellence 2020 Winners

Technology Provider of the Year » Fives A suite of technological innovations

“These technology innovations have come To be sure, even those are informed by the process followed by coating afterwards. to fruition in the last year or so, but the processes already in house, as well as trends Wet FlashCooling allows the control of development goes back for several years,” and developments in the industry at large. all key cooling parameters, in particular said Guillaume Mehlman, president of the “The Wet FlashCooling is an example of the starting and final temperatures. Fives steel and glass division at Fives. Some of the a push development,” said Mehlman. asserted that other technologies do not work has been a pull development, meaning “Most of the quenches worldwide are like a control the strip end temperature and it was started by a request from a client to Jacuzzi hot tub. We had ideas early on how often cool the strip to room temperature. help solve a particular process challenge. to do it differently. We proposed to a big As a result, some of the AHSS grades Others were push developments, meaning steelmaker in the U.S. that we could use which have specific annealing cycles with they originated with Fives and were then the quench to control both chemistry and intermediate cooling temperatures could taken out to the market. oxidation.” not be cooled at very high rates using water The longest running program is the Fives is in the midst of commercializing quenching. Wet FlashCooling opens the transverse flux, which has been under way the first installation this summer in North possibility of reaching a cooling rate of for 15 years. “It started as a pull from America, and is also gaining traction in 1,000°C/s for such grades, thus ArcelorMittal,” said Mehlman. “They were Asia. Installation has recently begun at one significantly reducing the need for looking for an induction technology to heat mill in China, and serious discussions are addition of alloying elements into the steel. their bright annealing line more quickly, under way with another company in the The successful implementation of Wet allowing more time for cooling.” region. FlashCooling in a large-capacity annealing The culmination of those years of work is, FlashCooling ® applies a two-phase line was the first step to validate the as Mehlman asserted, “I believe, the most liquid/gas spray at a very high, controlled, reliability and performance. The flexibility powerful induction heating for strip in the flow rate for vertical annealing and of the system allows processing of a large industry. It was a very long development galvanizing furnaces for advanced- and range of grades with different cooling-rate but we have sold about 10 licenses in the ultra high-strength steels. Implementation requirements. past two years. It is in industrial service in of Wet FlashCooling ® into the hot-dip The third technology is also a push, but Asia, Europe, and North America.” galvanizing lines with a non-oxidizing goes back several years, not unlike the Celes EcoTransFluxTM is a high-power technology will prevent the strip from transverse flux. “The launch customer is in transverse-flux induction technology for oxidizing while reaching 1,000o C per Russia. We are just completing the first rapid heating cycles. It is designed to second cooling rate. It also allows year of operations and have seen yield overcome process difficulty in annealing steelmakers to produce Gen3 AHSS, increase 1% to 2%,” said Mehlman. “That for new automotive-grade AHSS and coated directly in the hot-dip lines rather does not sound like much, but for a UHSS, as well as silicon steels. than requiring a continuous annealing steelmaker it is huge. We are already in The technology heats magnetic talks for implementation at other and non-magnetic steel at mills in Europe and Asia. We have extremely high speeds, as much as also seen some interest from 400°C/s, to temperatures above makers of stainless steel.” 900°C, at high efficiencies. It EyeronTM is a real-time quality- eliminates the need for extended management technology. The gas-fired heating, which also system provides full traceability means a significant reduction of of all process steps and quality NOx and carbon dioxide events from the melt shop emissions. Fives notes that radiant through the cold rolling and tube furnaces are limited in both processing lines, using all heating and efficiency at available process data. temperatures around 900°C. Material qualification and The increased temperature certification are delivered in real range meets the thermal time. Twenty-thousand rules are annealing curves necessary for automatically managed, allowing the production of AHSS and quality controllers to refocus on UHSS. Further, certain AHSS/ different tasks during UHSS steels have a high portion certification even as of retained austenite. Celes non-conformance is significantly EcoTransFlux provides the reduced. ability to heat both with stable Eyeron was successfully energy efficiency and less power implemented in the steel shop, consumption. the hot rolling mill 2000 and the The other two technologies plate rolling shop No.2 of were more push developments. FIVES Severstal, Russia in 2018-2019.

September 2020 | Metal Market Magazine | 47 Global Awards for Steel Excellence 2020 Winners

Information Technology Provider of the Year » Fives & Marcegaglia Ravenna Mathematical models to optimize coil processing conditions

Marcegaglia Group’s Ravenna complex flexibility, and general quality buys hot rolled coils on the market from improvements.” many suppliers all around the world, with Marcegaglia Ravenna patented several different primary production furnace types process steps in 2016 and 2017. It also and rolling processes. “The SmartLine and sought a technology partner in the Tensil-Pro projects were born in 2017 by the SmartLine development, and in 2018 strategic need to homogenize the output selected Fives. The two firms already had a produced by different raw materials,” said considerable history together. Aldo Fiorini, plant manager at Ravenna, also “Since the beginning Fives perceived the member of the board of directors and chief potential of the idea,” said Fiorini. “We were operations officer of the carbon steel flat convinced by the first encouraging results division. and by the possibility to exploit a big The development of advanced high industrial lab as the Ravenna plant is.” strength steel grades (AHSS) represented The SmartLine system has been working another driving force for the development of on Ravenna’s continuous galvanizing line systems that ensure uniform tensile (CGL) No. 4 full-time since December 2019. properties, both within the coil, and from coil “It must be considered that the CGL4 is the to coil. most advanced line with the widest range,” Marcegaglia and Fives have a joint- said Fiorini. “It can process coils with development agreement, which includes thickness ranges from 0.5 mm to 4.0 mm MARCEGAGLIA RAVENNA MARCEGAGLIA technical development of the SmartLine and and width ranges between 900 mm up to Tensil-Pro system at Ravenna. Fives is between the upstream supply and the 1,550 mm in AHSS grades, HSLA steels, responsible for worldwide process. The models calculate the targeted CQ, DQ and EDDQ.” commercialization. Fives and Marcegaglia mechanical properties, starting from the Marcegaglia identified several beneficial each retain ownership of their original metallurgical phases, grain size and heating results, including: technologies while the benefits of rate, among other properties. – Increase of productivity (>5%) commercialization are shared. “Predictive process models for the set – Uniformity of strip temperature profile “The key concept of the SmartLine point optimization – including speed of the (within +/- 10°C) project is the development of a metallurgical line, annealing cycle temperature, soaking – Uniformity of strip tensile properties master model able to evaluate the proper time and cooling, air-knives presets for the (+/-10MPa for Rm ≤ 400MPa; final annealing cycle, considering all the main wiping and elongation for the skin pass +/-15MPa for Rm > 400MPa) characteristics of incoming coil in terms of – were all based on the targeted mechanical – Improved uniformity of zinc coating chemical composition, hot rolled tensile properties of the final material,” said layer (25%); properties, cold rolling ratio and so on,” said Djahan. – Energy cost saving (5%). Fiorini. “For example,” he continued, “in the At press time, the SmartLine system was He explained that over the last few years annealing process, Fives provides a operating on CGL4 across the whole steelmakers recognized that development of predictive operation, Virtuo, using a 3-D production range and is under second- and third-generation steels require predictive model to run the furnace and implementation and testing on the other very tight control of the annealing process as optimize its thermal efficiency. It also three CGL lines at Ravenna; one is also well as on-line monitoring of tensile and controlled the line speed and thermal power pre-painting. Testing should be completed microstructural properties. Until a few years to regulate strip temperature as calculated by by the middle of next year. Marcegaglia ago, there were not proper tools with the the metallurgical models.” Group is studying implementation of flexibility and the reactivity required to Fives also provided the IT structure and SmartLine at its headquarters plant in achieve a full automatic in-line regulation of machine learning algorithms to make the Gazoldo degli Ippoliti for the cold rolling, the process parameters in the complete models more and more accurate and annealing and pickling of stainless steels, and production cycle. reactive. also in its San Giorgio di Nogaro plant in the “I would like to talk about our people and “Our main goal was to calculate and tune slab hot-rolling process. That facility is what they brought to this project,” said the process conditions in the continuous focused on high-strength and high-quality Shervin Djahan, CEO of Fives Keods. “We galvanizing line so it could adapt the process plates. have a dedicated team, people with parameters in light of incoming material Marcegaglia and Fives will continue in the high-level competencies in metallurgy, characteristics – chemical composition, direction of set point optimization and coating, development, and process hot-rolled tensile, and microstructural metallurgical modeling algorithms, fine operations. They provided the technical properties – and also cold-area processing tuning for further improvements in preset expertise necessary to implement the conditions,” said Fiorini. “Furthermore the calculations for air knives and for wiping and predictive metallurgical models.” introduction of the automatic pilot allowed annealing temperature. Those adjustments Those were a mix of artificial intelligence us to reduce direct costs through energy will take into consideration the hot-rolled and physical laws creating the missing links saving, increasing productivity, production strip properties.

48 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Environmental Responsibility/Stewardship » SSAB Americas Multiple projects support long-term sustainability

In 2019, SSAB Americas announced the EcoSmart imprint on intention for its operations to produce their products (as a steel using a completely fossil-free process stencil on plate or a beginning in 2026. With this target, SSAB printed tag on coil) Americas says it will be the first North and customized American supplier of fossil-free steel. documentation like SSAB Americas’ mill in Montpelier, Iowa test reports and is on track to be powered completely by invoices. renewable energy by 2022. A number of key SSAB’s US mills utilize scrap-based global customers EAF technology, using almost 100% have enrolled in the recycled materials in their production program since its process. In addition to scrap, SSAB Iowa launch in 2016. It is and SSAB Alabama (located near Mobile) targeted to intend to utilize fossil-free sponge iron customers who focus produced in Sweden as part of the Hybrit on sustainability as a project in the coming years, enabling the key business driver. eventual production of fossil-free steel. They receive regular Hybrit is a joint project led by SSAB in marketing materials

collaboration with Swedish mining and products AMERICAS SSAB company LKAB and Swedish Energy specifically company Vattenfall. designated as EcoSmart. The steelmaker – projects that started off as an innovation SSAB says that the results of its reports that interest in the program or opportunity that have fundamentally initiatives have been outstanding, from continues to grow. transformed a product or process over less waste being sent to landfills, to less The company’s development of time and now are part of the way the energy consumption and more materials baghouse dust recycling has evolved over company operates. being recycled. Big wins have included recent years. SSAB Americas generates “While it’s important to continue to be more than 6 million pounds of trash being about 55,000 tons of EAF baghouse dust innovative and creative in developing diverted from landfills, nearly 7 million annually at its two steel mill facilities. new ways to reduce waste/emissions and scrap tires recycled, reduced Since 2009, SSAB Alabama has been to improve energy efficiency, we believe consumption of electricity in certain areas recycling the dust generated from the it’s even more important to stabilize and by more than 6.5 million kWh, reduction EAF instead of disposing it in landfill. mature existing projects and programs so in carbon dioxide emissions in tons per Since 2010, SSAB Iowa has been doing that they can be further refined and ladle, and more than 300,000 tons of EAF the same. provide additional benefits toward baghouse dust being recycled. In 2013, SSAB entered into a new achieving long-term sustainability,” said SSAB has developed a scrap tire long-term agreement with a dust recycler Jon Howley, director, Sustainability recycling program that directly benefits for the recycling of EAF dust from both Business Development, SSAB Americas . local communities. Through its production facilities. Since the transition, The Covid-19 pandemic has slowed Foundation for Education, money saved SSAB Americas steel mill facilities have down progress as it relates to new by using recycled scrap tires is donated to recycled more than 324,000 tons of EAF investments and innovation, but the local schools in Alabama, in excess of baghouse dust opposed to landfill company continues to operate with $100,000 per year for a total of more disposal. environmental sustainability as one of its nearly $1.5 million dollars donated to SSAB Americas EAF baghouse dust top priorities as a company. “Our SSAB schools since the program began. In contains approximately 17-21% of zinc. Iowa facility remains on track to be addition, SSAB holds both LEED and The receiving recycling facilities reclaim powered completely on renewable energy ISO certifications for certain facilities. the zinc and other metals from the dust. in the coming year, our recycling programs SSAB Americas also has a product The recycling facilities produce two main remain in full swing, and we continue to brand program called EcoSmart™ that products from the dust: crude zinc oxide partner with our European operations to educates end-user customers on the and iron product. End-products using the work toward the development of fossil- company’s environmentally sustainable zinc oxide after further processing free steel,” said Howley. steel operations and products, including include tires, rubber-soled shoes, glazed SSAB Americas remains focused on air it using more than 96% recycled tiles and animal feed. End- products using emission reductions as a priority, materials, running sustainable operations the iron include cement and asphalt. specifically as it relates to CO2e and increasing renewable energy The main area of progress for SSAB reductions. “For SSAB on a global scale, consumption. Americas in 2020 has been the we are set on achieving our vision of being Customers who have been on-boarded stabilization of various projects that have first company in the world to offer to the EcoSmart program receive the become formal programs for the company fossil-free steel,” Howley added.

September 2020 | Metal Market Magazine | 49 Global Awards for Steel Excellence 2020 Winners

Logistics/Transportation Provider of the Year » Ryder System Inc Achieving the digital transformation of logistics

manufacturer to the end-user or job site without any other touch points. Flexibility is also an attribute of truck delivery, whereby it is much easier to divert a product to another location or change jobsites or make additional stops, as well as manage the reverse logistics if required,” Martin said. Ryder’s services for its customers have enabled the firm to increase its revenue for some customers by 3.5 times in the past few years. Since partnering with Ryder for dedicated solutions, customers have experienced better than 99% on-time delivery, flexibility to ramp up their fleet RYDER SYSTEM INC SYSTEM RYDER by 400% during peak seasons, 95% Combining more than 87 years of learning and leveraging our data to drive decrease in inventory and equipment loss, operational experience with leading-edge customer and product value. Automation and savings of $500,000 annually from business tools and solutions has led Ryder has improved productivity and quality, backhauls. System, Inc. to have access to one of the digitalization has improved our customer “We can save companies on average up largest flatbed truck fleets in the United experience, and technology modernization to 25% on their transportation spend by States and become a key partner to metals ensures our technology solutions are rightsizing their fleet. Many companies companies. That history of providing a always on and available,” Martin said. have trucks that are under-utilized for safe, reliable and cost-effective delivery Ryder’s innovative technology solutions much of the year to ensure capacity for system supported by innovative include: seasonal surges. We can look at their fleet technologies and drivers who understand - RyderShare™ - It creates real-time utilization and determine exactly how the needs of the metals industry earned visibility and collaboration for all many trucks they actually need year-round Ryder the Logistics/Transportation parties across the supply chain to avoid and then supplement those fleets during Provider of the Year Award. delays and maximize efficiencies. peak seasons with our portfolio of Today, Ryder is an $8.9 billion Fortune - RyderGyde™ - It provides fleet transportation products,” Martin said. 500 transportation and logistics giant managers and drivers the ability to In addition to the wide array of operating a fleet of more than 290,000 easily manage their fleets or a single technologies and specialized services vehicles with more than 800 maintenance vehicle from one device, including offered by Ryder, its backbone remains its facilities. The company employs more scheduling maintenance appointments employees. The firm is an industry leader than 6,000 technicians and about 9,500 in 60 seconds or less and accessing in safety and security, with Ryder having drivers, who work with more than 55 quick-response roadside repair. one of the lowest collision rates in the million square feet of warehouse space in - Ryder’s OpsBox™ - An analytics industry. The safety measures are more than 300 locations. Ryder manages platform for labor management, daily supported by DriveCam™ by Lytx™, more than 31,000 monthly border metrics, workforce planning and which combines data and video analytics crossings between the United States, customer visibility dashboards. with real-time driver feedback and Canada and Mexico. In addition to its wide array of digital coaching to reduce injuries and collisions. One of its platforms for growth – and a platforms, Ryder has helped more than 70 One of the key challenges facing the significant strategic advantage – is Ryder’s companies convert to new vehicle industry is the availability of drivers. Ryder widespread and far-reaching commitment technologies to lower fuel costs and is taking a two-pronged approach. First, it to technology “to support a fully optimized consumption. Ryder has the second largest focuses on retention efforts with transportation network and supply chain,” natural gas fleet in the United States and is progressive pay rises based on longevity, said Steve W. Martin, Ryder’s senior vice the second largest purchaser of diesel fuel more comfortable equipment, schedules president of dedicated transportation. in the United States after the federal that allow drivers to frequently return to “We have always used technology to government. their homes and collaboration with other enable our business to deliver value for our For the movement of steel products, companies to optimize shipments so that customers. In 2018, we embarked on a Ryder believes that flatbed delivery gives it drivers have more single-day routes. digital transformation with a focus on the and its customers several advantages over Secondly, in the area of recruitment, Ryder people, processes and technology to evolve other transportation modes. “We offer our has partnered with Hiring Our Heroes to from ‘technology as an enabler’ to metal customers dynamic routing to identify veterans and transitioning service ‘technology as a differentiator.’ We also ensure the most efficient model to service members for possible employment as well focused on expanding our data strategy our customers’ daily deliveries. Trucks as with Women in Trucking to tap into an around advanced analytics, machine deliver directly from the producer or underutilized talent pool.

50 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Raw Materials/Consumables Provider of the Year » Cronimet Envirotec Turning byproducts and soft scrap into raw materials

Building on its foundation of recycling waste streams is a challenge for a lot of milestone when it opened a briquetting waste material generated by other metalworking companies. If the waste is plant, which enabled the firm to process businesses has earned Cronimet Envirotec being recycled with other technologies, the metal powders for re-use in the metals GmbH a global reputation for leading- metal’s quality is hardly being maintained.” industry. In addition to winning the Raw edge technologies to process metal-rich In time, the Bitterfeld-Wolfen facility Materials/Consumables category in the wastes for reuse. In only seven years, the expanded its services to process additional Fastmarkets Awards Program, Cronimet firm has grown to become a global leader in wastes. The site now handles metal- Envirotec also won the Best Innovation – the processing of secondary raw materials bearing sludges, mill scale, filter dust, Process category. through its combination of technology and metal powder and other soft scrap and “With the commissioning of our new its commitment to sustainability that has waste to turn them into usable secondary briquetting plant in 2019 and the use of an earned it the award of Raw Materials/ raw materials. In addition to the desire to innovative binder, it is now possible to Consumables Provider of the Year. increase sustainability, the Cronimet produce raw materials that can be melted, Founded in 2013 in Bitterfeld-Wolfen, Group was facing the growing challenge to attaining the attributes of solid scrap, from Germany, Cronimet Envirotec has had help its customers recycle not only solid originally hazardous byproducts and steady growth in the processing of stainless scrap but also find a solution for soft scrap waste. Cronimet Envirotec thereby largely steel sludge, oily mill scale, filter dust and such as sludges or fine powders. contributes to a zero-waste industry,” said fines created by the metals and oil and gas Furthermore, there is a great need to Costa. “Additionally, these technologies industries. From its early days, the firm dispose of or recycle waste materials that enhance the environmental sustainability used vacuum distillation to process contain oil or nickel in fine particles for of the metals industry and contribute to sludges. “With its vacuum distillation instance. This means that companies are stable raw material prices.” The process, it is possible to recycle up to 100% responsible for compliance and briquetting plant has an annual capacity of of the input material while separating it monitoring, and the options for disposal 50,000 tons. In addition to the new from all contaminants without adding any are scarce. “It was a combination of briquetting plant, 2019 also saw the chemicals. This process closes the life cycle listening to the market’s needs as well as a opening of a new storage facility and a for metals and oils, at a lower energy-per- step to diversify within the Cronimet laboratory to expedite metallurgical ton consumption compared to competing Group. Clearly, recycling offers cost analysis assuring consistent quality. technologies,” said Dr. Filipe Manjolinho advantages for both sides,” Costa said. In the past few years, Cronimet Costa, managing director of Cronimet By 2016, the firm, with the backing of its Envirotec has enjoyed year-over-year Envirotec. parent Cronimet Holding GmbH, growth in both revenue and customer base “Before the inception in 2013 of expanded its offerings and its geographic by 50%. The portfolio of materials Cronimet Envirotec, grinding sludges and reach and began processing additional processed by Cronimet Envirotec has filter dust were either taken to landfills or secondary materials. While the firm increased by handling not only soft scrap incinerated,” Costa said. “Sometimes, continued to provide recycling such as sludges but very fine particles as companies were able to re-circulate their methodologies to its customers, in 2019 well. “Our global reach, experience and own by-products but the heterogeneity of Cronimet Envirotec achieved a major expertise have allowed our company to achieve complete separation of contaminants from the metal waste streams and result in consistent quality in secondary materials products,” said Costa. Cronimet Envirotec is taking its success with waste streams from stainless steel, tungsten carbide and high-speed steel and is looking to process the waste from other metals. It is also looking to expand its geographic reach beyond its neighboring countries to elsewhere in Europe and to North America. “We started with a focus on stainless steel and already recycle other metals such as copper and iron as well. We are actively working on our business development for zinc-coated metals and other materials such as pickling sludges or galvanic/electroplating waste as well. We are testing some processes in our laboratory to see which materials are the best fit for our consuming industries and

CRONIMET ENVIROTEC CRONIMET our company,” Costa said.

September 2020 | Metal Market Magazine | 51 Global Awards for Steel Excellence 2020 Winners

North American Scrap Company of the Year » ICD Alloys and Metals Creating a key supplier of specialized metals

Wanting to create a one-stop shop for minor metals and specialized scrap materials, ICD Alloys & Metals LLC (ICD) was formed only seven years ago and today offers its global customer base a single source for the processing, preparation and supply of a wide variety of less common inputs into many industrial processes. With its novel product offering of primary and secondary materials, processing capabilities and global reach, ICD was named North American Scrap Company of the Year. ICD was founded in 2013 in response to “a huge disconnect with regards to minor METALS AND ALLOYS ICD metals and scrap recycled metals, which resulted in purchasing managers searching top quality required by our cutting-edge organically in order not to jeopardize its several companies all over the world to customer base,” Conlin noted. internal stability or its consistency of secure their needed materials,” said Dr. Since its founding in 2013, ICD has products and services for its customers. Steve Conlin, president of ICD Alloys and continued to record year-over-year “We have worked very closely with the Metals with headquarters in Winston- growth while serving such industries as ICD Group management team to ensure Salem, North Carolina. “With our financial aerospace, oil and gas, petro-chemical, that we maintained a growth rate that was strength, we can stock 10 to 20 different medical and steel production, among natural and would create a solid basis for products and perform the processing to the others. Capital expenditures have our company’s future,” Conlin said. customers’ requirements. Our in-depth improved material handling capabilities Although virtually no-one was expecting reach globally on supply allows us to find while the firm has grown its supply chain the worldwide Covid-19 pandemic and its hard-to-reach products and deliver them and worldwide customer base. impact on key consuming industries seamlessly to the customer. We call our To gain entry into supplying its served by ICD, including steel, the approach to our business ‘mine to market’,” customers’ industries, ICD must obtain company has been managing the crisis by he said. The alloys and metals company is a various approvals from accrediting diversifying its regions of supply and subsidiary of the privately held ICD Group authorities, including ISO certifications “to working with major producers to ensure International headquartered in New York ensure our products meet the customer’s its customers maintained their material City, which manufactures, trades and specification requirements and tolerances. needs despite some supply chain distributes specialized commodity In some cases, we are able to provide our disruptions caused by the virus. “By products. in-house laboratory testing to prove the having a diversified supply chain and a The success of the alloys and metals necessary qualifications for the customer’s varied inventory mix, ICD has managed to processor’s first production facility in specifications to ensure optimal continue supporting its customers by Winston-Salem, led ICD to establish, in performance in its application,” Conlin using its stockpiled products and balancing 2017, a second processing facility in explained. Product testing can take as long the supply regions to ensure the customers Sheffield, England, which “allowed us to as 12 to 24 months to ensure the material were not suffering significant delays that become a global recycling revert company will perform as intended in its end use. would impact production,” Conlin reaching all areas throughout the world for Despite the company’s steady growth, explained. supply. Our increased investment in an ever-changing marketplace presents ICD remains committed to its revert equipment helped us achieve the absolute challenges. Price fluctuations and supply management services and “to increase our constraints can quickly capacity to provide recycled metals. As a disrupt ICD’s markets. To leader in the scrap market, we believe it is counter market fluctuations, key for the future of our industry as we are ICD has established a diverse globally experiencing a lack of supply for source of supply and has some virgin metals or a saturated market created long-term supply for certain elements. However, we also contracts to protect its plan to satisfy the demand of our financial stability and its environmentally conscious customers for commercial contracts. While recycled metals. We are proud of the rapid growth is generally seen impressive results our team has achieved as a good thing, ICD has been in our first seven years and are committed mindful to not over-extend to sustaining that growth going forward,”

ICD ALLOYS AND METALS AND ALLOYS ICD itself and has instead grown Conlin concluded.

52 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

EMEA Scrap Company of the Year » RKG International FZC Investing to meet changing international requirements

RKG International FZC staff believe in two for shredding of ferrous metals. This helps to monitor the movement of its challenging themselves. “We believe that Purchase of a new shredding machine vehicles around the clock and to optimize every business can benefit from having a and expansion of the premises helped RKG fuel efficiency. strong network,” stated the company. “So to shred on a regular basis, which helps to The introduction of Value Added Tax building a personal network has greatly meet both local and export requirements. (VAT) in the UAE at the beginning of 2018 contributed to the success of our company,” Buying the new shredder has made RKG meant that businesses and merchants it added. The company believes in having a the largest producer for ferrous shredded needed to incorporate it into their strong company culture and the right team material in the UAE Region, the company accounting systems. to provide best customer service to set it notes, with large local steel mills as RKG International FZC reviews its local apart from its competitors. customers for its products. sales, imports and exports on a regular RKG International FZC also notes that To meet the daily needs of domestic basis with an efficient SAP system, there are many challenges related to consumers, RKG has its own transportation incorporated as a part of its accounting exporting material globally. They include division with a fleet of more than 53 system. It helps the company to meet the systems of material clearance, inspection vehicles, which is a key vertical for the needs of complex business, such as procedures, changing environmental business and plays a very important role in evaluating performance, reporting and regulations, metal market price volatility the company’s success. A team based at the decision-making. This helps the company and the variability of weather conditions. company’s head office in Dubai periodically to review transactions regularly, buy The company’s mission is to create a assess its fleet operations. “This helps us efficiently, manage costs, expand and meet long-term business by understanding the develop good business relationships with market needs, expand sales, reduce errors mutual relationship between client and our suppliers and buyers,” RKG noted. and manage stock control. The SAP organization. RKG has expanded its The company also employs its own staff system used by the company minimizes premises in Sharjah, UAE. Having started for maintenance of the fleet. It monitors the risks and helps in continual improvement with one scrap yard, it now has three. One is on-road performance of drivers and of the company, RKG International FZC used for HMS & aluminium and the other vehicles by the use of a tracking system. concluded. RKG INTERNATIONAL RKG

September 2020 | Metal Market Magazine | 53 YOU’VE GOT CONCERNS.

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AUTO SHREDDERS • NON-FERROUS SEPARATION & SORTING • WIRE CHOPPING • SERVICE & SUPPORT Global Awards for Steel Excellence 2020 Winners

Scrap Equipment Company of the Year » Wendt Corporation A team effort to deliver advanced technology

In 2019, Wendt Corp. decided to put significant time and investment into a reorganization and expansion of its sales and service teams. The results were a record year for sales and an award for steel excellence, but an even bigger prize may come in the next year or two. The strategic moves have put Wendt Corp., headquartered in Buffalo, NY, into a strong business and technology position not just to weather the current recession and upheaval in the supply chain, but also to support scrap operators as they struggle through unprecedented times. Buffalo is legendary for its tough and determined sports teams and fans. They know that great players do not just execute well themselves: they raise the performance of the athletes around them. That is how Wendt approaches its business. “There are 350 to 400 scrap operators in North America,” said Tom Wendt, WENDT CORPORATION WENDT president and son of founder Thomas Wendt, “we do business with about half of environmental compliance, safety, That approach means the company has them. That is everything from turn-key productivity and reliability.” added heavy-lift and project-forwarding facilities, to individual machines, to The dry system has a double benefit: no logistics to its capabilities. “Some of the big component parts for our competitors’ process water means no waste water and shredders are quite an undertaking,” Tom equipment.” no sludge; it also means nothing to freeze Wendt elaborated. “In one instance the Wendt Corp. is well known for auto in the winter. “It gets pretty cold in base was even too big to move by rail. It shredding and scrap processing, including Buffalo,” Tom Wendt noted, “but we are had to be done in two sections. All of that is advanced sorting and recovery such as known more for our snow, not the cold handled by our supply-chain manager.” wire chopping. It also has business in they get in Minnesota.” Wendt Corp. has also invested heavily in baling and shearing, aluminium recycling, While the engineering and logistics technology, from sensors on the line to and processing of tires, e-scrap, and teams finished that big project, Wendt enterprise-wide Industry 4.0 connectivity municipal solid waste. That range extends Corp. revamped its sales and service for equipment and operators. Underlying to waste-to-energy. teams. “We now have three regional sales that high tech is the fundamental The core group of customers is auto managers,” Tom Wendt detailed. “We also understanding of scrap economics. shredders, which extend from small have three business development “Operators mostly have the market owner-operators to large regional managers who are more like stewards for values established for them,” Tom Wendt independents, to the biggest scrap our various lines,” he added. There is also explained. “The mills pay a fixed price for subsidiaries of steelmakers. At the entry an inside sales team of two engineers, one certain volumes and quality. Operators level, Wendt has just expanded its range of project coordinator, and the marketing that buy over the scale pay a fairly fixed basic car shredders. director. “Then there is the sales director, amount. Sellers can just go down the road At the largest scale of liberation and and me,” he explained. The company also to the next guy. The only way to generate separation, Wendt Corp. has just expanded the service team from seven to profits on that spread is through more completed commissioning one of the 12 as part of the reorganization. efficient processing.” largest complexes it has ever built, for “We’re focusing our manufacturing “You can do that through brute force Northern Metals Recycling in Minnesota. expertise on the OEM components of the with older equipment and a lot of manual “The entire system is inside a building system,” said Tom Wendt, “and continuing labor,” he continued, “or you can do it with under negative pressure,” said Tom a strategic subcontractor model using a more technology and fewer people. Wendt. “There is a pile of inputs on one long-established network of specialized Volume is the way to make money. We side, and piles of clean scrap on the other. fabricators. Some of the bigger have customers of all types.” You can’t hear or see or smell anything in installations might involve 150 to 200 In announcing the award to his staff, Tom between. All the air inside is filtered and truckloads coming from the fabricators, so Wendt emphasized the effort of the team. tested. And it is a dry system, no process it’s important to have that local to the job. “A lot of people take a lot of pride in what water. It’s probably the most advanced Our shop is mostly for OEM and assembly they do here. It was most satisfying to know system in existence in terms of of specialized pieces.” that is being recognized,” he concluded.

September 2020 | Metal Market Magazine | 55 Global Awards for Steel Excellence 2020 Winners

Automotive Supplier of the Year » Gerdau Special Steel North America Working closely with auto companies to advance

Building on more than 45 years of Although capital improvements are also significant interest in hybrid as well as successfully supplying special bar quality necessary for remaining competitive, electric vehicles. At Gerdau we have been (SBQ ) steel products to the North equally, if not more, important to Gerdau is working in these areas and becoming American automotive industry, Gerdau its relationships and communication with involved in the work taking place in Silicon Special Steel North America strengthened customers. Several years ago, the firm Valley as the U.S. center for innovation and its commitment to the industry with capital realized that many of the people who create technology,” said Belloc. expenditures, technical services and new the final products using Gerdau steel at a Gerdau first opened its Silicon Valley ways of listening to and supporting its forging company or directly at an OEM had office in 2018 and is working closely with a customers, leading to its winning the never been in a steel plant. To provide variety of firms to develop leading-edge inaugural award for Automotive Supplier of steelmaking and finishing insight, Gerdau technologies. Areas of interest include the Year. in 2017 instituted Steelmaking 101 training identifying startups with solutions for “About 75 to 80% of our special steel and mill tours to bring the entire steel integrated supply chains and advanced products go to the automotive industry. We supply chain closer and help the automotive materials, including 3D printing and have been working with our customers for engineers better understand the products metallic powder. The Silicon Valley office is many years to understand trends in steel they work with. also monitoring automotive trends and has applications and how their business impacts Based on the success of the Steelmaking been working with some of the automotive our business,” said Rodrigo Belloc, 101 program, Gerdau in October 2019 laboratories to build relationships. president of Gerdau Special Steel North hosted Market Intel Day as a free benefit for One area of significant interest for America. “Building off of our successes with its customers. The event, attended by more Gerdau is the continued development of similar operations in Brazil and Spain, we than 100 customers, brought together Tier electric vehicles. Recognizing the need for decided to acquire, in 2008, MacSteel, 1 suppliers and automotive OEMs “to alternatives for fossil-fuel based which helped grow our position in special discuss and align our knowledge and transportation, the firm created a team of steels,” and created an even deeper line of forecasts with emerging trends affecting technical engineers focused on products for automotive applications for electric vehicles and other topics,” said understanding future parts needs for the steelmaker. Belloc. Also featured were experts from the electric, hybrid and autonomous vehicles. Gerdau has invested more than $300 Center for Automotive Research, Reuters Working cooperatively with specialized million in its Monroe, Michigan, special and Autoline to share insights on forecasts engineers in the electric vehicle arena helps steel complex in the past few years. Those for the near- and longer-term to ensure that deepen Gerdau’s understanding of the improvements began with a new the forging companies and other key needs for special grades, weights and continuous caster in 2012, followed by a suppliers work together to meet future requirements for steel products. Gerdau is twin-tank vacuum degasser, walking beam needs. also keeping an eye on the development of furnace, six new rolling mill stands, a bar “What became clear from Market Intel the fast-paced technology of electric vehicle straightening and inspection facility and a Day is that the industry is looking to batteries, “which will influence the twin ladle furnace. “In 2021, we will also advance lightweight and high-strength acceptability and cost of electric vehicles,” have a more powerful electric furnace to steels with clean steel technology. There is Belloc said. increase capacity and improve quality,” Belloc said. In support of its physical assets, workforce and customers, Gerdau is also adopting a new enterprise resource management (ERP) system powered by Plex, which is a software package widely used by the automotive industry. “A few years ago, we decided that Plex would more fully integrate the supply chain and reduce waste by providing better service and more information to the customer,” said Belloc. Those improvements are helping Gerdau retain its leadership position in supplying SBQ products to the automotive industry. Gerdau products are used in crankshafts, steering rack systems, transmission parts and drivetrain components. The firm also offers support at OEM sites through specialized teams, including technical service and research and development

engineers. AMERICA NORTH STEEL SPECIAL GERDAU

56 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Ferrous Trading Company of the Year » Crunch Risk Explaining the value of ferrous derivatives to the supply chain

will continue to service them well.” utilized the futures space that in a relatively Marshall pointed out that, as a voice short period of time they have realized how broker, Crunch Risk does not handle helpful the use of futures contracts is for their customer accounts. Instead, its role is to business,” Marshall said. He explained that it match prices in the market, therefore serving gives them more flexibility in terms of what a different function than futures clearing they can offer their customers, including the merchant (FCM) brokers. “We are purely on ability to offer them fixed prices. “It also the execution side,” helping to keep Crunch allows them to take advantage of the shape of Risk’s customers informed where prices are the forward premium curve,” he added. on a daily, or even on an intra-day basis, and “While we have grown our customer base matching those prices. quite a bit over the years and always have a There has been significant growth in interest While being a small company, currently number of clients that are in the pipeline, our in ferrous futures contracts – both for steel with two front-office brokers – Andre and only regret is that we haven’t had the and ferrous scrap – with strong indications his brother Jack – Crunch Risk has seen its resources to go out and find even more that participation in trading them will customer base grow well over the years, clients,” Marshall said. “There is always a lot continue to grow exponentially. mainly through referrals within the industry. of interest in the marketplace and I think it Andre Marshall, founder and president It has done so not only through its will continue to grow, possibly of Crunch Risk LLC, an interdealer or voice involvement in the growing steel and scrap exponentially.” broker with a large client base in the US futures markets, but through its involvement He said that currently by far the biggest steel and ferrous scrap futures space, said in futures contracts for aluminium too. participation group – presently responsible that one big reason for this is all of the Crunch Risk notes that it is the only material for 60% or more of ferrous futures activity uncertainty, and therefore price volatility, broker participant in the US domestic scrap – has been steel service centers, although in the ferrous metals marketplace, which futures markets. recently participation by steel mills and has had a dramatic impact upon companies’ Marshall noted that Crunch Risk was small- and medium-sized OEMs has been bottom lines. involved with the ferrous futures markets increasing. “Risk is a funny thing,” Marshall said, “You from the start, helping the CME with its Marshall admits that futures contracts are very comfortable in certain business launch of its steel futures contract in 2008 have long been something of a foreign tool environments and then all of a sudden and doing the same with the CME AMM for some traditional steel industry something like this happens.” He said that scrap futures contract. It has grown along participants. “But that is changing. People while the current business environment, with the ferrous futures market space, which are becoming more aware of it. And as it impacted by the Covid-19 pandemic, could has recently seen the addition of several new becomes more mainstream it will continue definitely be termed as being unusual, it is futures contracts. For example, the LME has to grow,” he said. also worth pointing out that, recently, added both steel and scrap contracts and the While Crunch Risk does not have any big unusual events have been happening every CME has added a US hot dip galvanized expansion plans other than adding another three to four years. “And when you add in all contract, which Marshall said has already front office broker, Marshall said he is the changing growth forecasts for various given Crunch Risk additional traction, and a hopeful that the company will grow with the parts of the world, that is resulting in Northern Europe steel contract. growth of the industry. “We believe what we companies, including steel companies, “Generally, it is the experience of our do is important for the space and for our wanting to operate their businesses with all clients who have engaged in and have customers,” he concluded. of the tools that they can.” Marshall said that from the company’s inception it has been Crunch Risk’s generic message to the ferrous community, including to steel mills, steel services centers, steel end-users, and scrap and other raw material suppliers, that futures contracts are an important tool that they could use to help mitigate the risks of the movement in the prices of the products they sell. He said that – in what he sees as a differentiating factor compared with others in the space – Crunch Risk communicates this message, explaining, “We don’t divulge the identities of our clients and are treating our clients’ orders as we would treat our own orders. Our clients know that they can rely on us, trust what we say and know that we IMAGES GETTY

September 2020 | Metal Market Magazine | 57 Global Awards for Steel Excellence 2020 Winners

Exchange Company of the Year » SGX Price risk management for the steel sector

Steel mills can hold large inventories of raw materials, semis and finished products to keep production moving smoothly, so price risk is a major concern. Effective use of risk-management tools, for both physical and financial hedging, enables mills to hold inventories while minimizing the price risk. As iron ore has emerged as a global commodity, derivatives are also increasingly used by global asset allocators as a financial instrument to express their views and offer macro exposures on China. Volatility in the iron ore market during the past year, characterized by supply shocks that sent prices soaring, clearly demonstrated that derivative contracts are a fundamental tool for price risk management for the physical market. The efficacy of exchanges in providing risk management solutions is often witnessed

during times of market stress. SGX Singapore is neither a producer nor consumer of iron ore, yet the Singapore said Chin. “The hard part is to get it correct. since its launch, with monthly traded Exchange (SGX) pioneered the iron-ore That takes years of validating market volumes increasing consistently, reflecting derivatives market with the launch of the demand and building liquidity.” For new strong client and industry demand. world’s first swaps in 2009. Ten years later, contracts, he made the analogy of attacking Traded volumes hit a single-day record of SGX claims primacy in international price and defending. “At first, with a new over 750,000 tonnes and a monthly trading discovery and risk management for bulk contract, there is no competition. Then as volume of 3.84 million tonnes in October commodities. the contract grows, so does competition. 2019. This is significant as iron ore trading “It is a long game we are playing,” said You have to defend.” activity is typically expected to slow in William Chin, head of commodities at SGX. More specifically, Chin explained, “Is October amid the week-long Golden Week “A lot of hard work goes into developing there sufficient liquidity for traders to get holiday in China. what industry says they need.” Once that is into and out of their positions efficiently? Chin recalled “It used to be people spoke in place the work does not end, he added. Are bid-ask spreads sufficient? The in terms of a few people being ‘locked in a “We take meaningful measures across all contracts evolve. They never stand still.” room’ to determine pricing.” He noted that, contracts, [for example, trading] velocity Since 2009, volumes in SGX’s iron ore more recently, “We have seen a breakdown and how much hedging is taking place.” derivatives have seen explosive growth, in those annual negotiations and the SGX launched a variety of iron-ore giving SGX a dominant market share of introduction of reference prices. Into that derivatives including the 62% Fe, 58% Fe, over 98% of the seaborne iron ore environment we launched the 65% contract lump premium swaps, iron-ore options derivatives market and 100% of the coking in December of 2018.” and, more recently, the world’s first coal derivatives market, the exchange notes. Amid the high-tech of global electronic high-grade 65% Fe iron-ore contract. The This had also spurred the growth of a paper trading, Chin emphasized the importance 65% Fe contract was launched in market that today clears more than the size of infrastructure: alignment of the December 2018, following a blowout of of the underlying physical market by a contracts and trading systems, support for the “quality spread.” factor of 1.28 (1.99 billion tonnes paper the platform, liquidity and market Volumes and open interest more than versus 1.55 billion tonnes physical). supervision to prevent excessive doubled during each of the first five years of The launch of the 65% Fe cash-settled speculation and volatility. SGX’s launch of the iron-ore derivatives contract is significant as it complements the “The pandemic has been a stark business, hitting a record of 1.67 billion iron ore suite and provides an important reminder of the less sexy, less intriguing, but tonnes in 2016. In 2019, SGX’s iron ore added dimension of risk management. critical parts of a global exchange,” Chin derivatives volume hit a new high of nearly Producers are able to secure revenues, noted. “Trading has to be fair, orderly and 2 billion tonnes, breaking the 2016 record, while steel mills can fix input costs relating transparent to ensure our role as an with deepening open interest across the to high-grade iron ore. Traders and other international risk-management center. We entire forward curve. SGX’s average open participants are also better equipped to were stoked to win this award because it was interest figure during 2019 was 167 million protect physical stock positions. testimony to our hard work in ensuring that tonnes, up 38% year-on-year. This contract, based on the Fastmarkets infrastructure could stand up to the recent “It is relatively easy to launch a contract,” 65% Fe iron ore index, saw robust demand market pressures.”

58 | Metal Market Magazine | September 2020 Global Awards for Steel Excellence 2020 Winners

Workforce Diversity Company of the Year » ArcelorMittal Dofasco Strategy for a diverse and inclusive organization

Playbook, understanding of the needs of customers, ArcelorMittal community and market opportunities. Dofasco created – Attract, retain and engage the best the formal, employees. The company wants to corporate attract and retain the best talent, be an framework and attractive employer of choice to the structure that sets widest potential talent pool and be its strategic recognized for supporting all of its direction for a people to reach their potential and diverse and contribute to the success of inclusive ArcelorMittal Dofasco in a positive organization. work environment. ArcelorMittal – Promote a healthy work environment. A Dofasco says it is healthy work environment benefits all. committed to By promoting a healthy environment ArcelorMittal says it knows that workforce creating a diverse workforce and to employees, the company inspires diversity and inclusion is an asset to its incorporates diversity into all aspects of health in all areas: physical well-being, business. When it assembles a broad range of employee recruitment activities, emotional security and mental ideas, experiences, insights, and creativity, in understanding that recruiting for diversity wellness in a safe and nurturing a welcoming environment, it is able to contributes to better outcomes and environment. demonstrate the strength of its values of performance. – Enhance employee engagement and leadership, sustainability and quality. “The strength of our team peaks when we ownership. When employees take the The company’s commitment to engage all,” the company states. Specifically, lead, they find better solutions and own diversity and inclusion starts with its it notes that diversity recruiting provides the results. Diversity and inclusion are ArcelorMittal Diversity & Inclusion many benefits, including a broader range of key drivers for employee engagement Policy, which clearly outlines its purpose skills and experience, increased cultural and and ownership. and principles. Building on this corporate language knowledge and a larger and more “We value our employees and the policy, ArcelorMittal Dofasco has created varied candidate group. “We ensure that we diversity that they bring to their jobs every its own vision, mission, values, principles have a bias-free process while using a day: diversity of thought, experience, and strategic priorities. Base on those, merit-based hiring strategy,” it adds. gender, religion, age, race, ethnicity, sexual ArcelorMittal Dofasco has developed a Dofasco hosts an internal referral program orientation, education and other qualities,” five-year Diversity & Inclusion Roadmap for employees to recommend candidates. Its stated the company. “To strengthen the with timelines and milestones to guide its strong university internship program benefits of this diversity, we have activities and progression. recruits at a range of universities from across implemented programs and teams to To define its direction and benchmark the country. support our employees and develop and best practices, the company engaged the The company also states that for over 50 retain our diverse workforce,” it added. support of the Canadian Centre for years its slogan “Our Product is Steel, Our Since 2017, ArcelorMittal Dofasco has Diversity and Inclusion (CCDI). Through Strength is People” has shown that its had an employee-led Diversity and this partnership, it has been able to organization values individuals and knows Inclusion Team leading the company’s understand gaps better and identify that its success lies in the knowledge and diversity and inclusion initiatives. This opportunities for growth and development. skills of its employees. team has been the driving force behind the The value that diversity and inclusion The company says there are several achievement of its strategic plan and its brings to ArcelorMittal Dofasco is clearly reasons to focus on recruiting for diversity Diversity & Inclusion Roadmap. represented in the company’s 2020 and inclusion, including: The company’s team has implemented Playbook, a visual representation of its – Increased innovation. A diverse many successful diversity and inclusion corporate strategy. The 2020 Playbook workforce brings a broad range of ideas, initiatives that have helped it to develop and outlines inclusion as a key factor in a experiences and insights through successfully retain its diverse workforce. strategy to “win”. The strategy is predicated teamwork, creativity and breakthrough “Our annually celebrated events include on ensuring that employees are comfortable thinking, fostering a culture of Diversity & Inclusion Week (with speakers, to bring their whole self to work and that continuous improvement that creates events and fundraising for charities that they are embraced and valued in a work improved opportunities to define new support Diversity & Inclusion), environment that allows them to excel both markets, solve customer challenges and International Women’s Day, and professionally and personally. meet stakeholder expectations. International Day of Pink (to celebrate Through its diversity policy, its diversity – Customer and community focus. A diversity and eliminate bullying).” The and inclusion strategic priorities and goals workforce reflective of customers, the company also features speakers and and its connection with the CCDI, as well as marketplace and the community has personal employee stories to celebrate the integrating diversity into its 2020 good communication and a deep diversity of its employees.

September 2020 | Metal Market Magazine | 59

Global Awards for Steel Excellence 2020 Winners

Tube & Pipe Producer of the Year » Borusan Mannesmann A strategy to succeed in all market conditions

Approaching its business as a three-legged stool built on safety, quality and reliability – with each leg carrying the same weight – has helped Borusan Mannesmann excel during a period of uncertainty facing energy products providers. By embracing “first time right” manufacturing principles supported by Lean Six Sigma processes, Borusan of Houston, Texas, has continuously operated since its inception in 2014 despite sizable fluctuations in input costs, market conditions, regulatory environment and, in 2019 in particular, a continuously contracting customer base reflected in the oil rig count in the United States. The company’s success, backed up by strong business processes, helped Borusan to again be named Tube and Pipe Producer of the Year. “This recognition is the culmination of continued extraordinary effort by our employees,” said Josh Croix, MANNESMANN BORUSAN chief commercial officer for Borusan in the United States. “Our world class facilities, material, and allowing customers to retain the firm has long worked with vendor supplier partners, customer partners and their design parameters but with less steel. partners to maintain agreements with processes honed over a 62-year tradition “These types of products demand the long-term views that will ensure all parties of excellence all play a critical role in our highest level of attention to detail and are are healthy during the peaks and can success, but it is our people who truly the highest evolution of a quality system. withstand the valleys of the energy market. deserve this recognition,” he added. Our people make the Borusan difference,” On the demand side, Borusan has increased With safety being part of the three- explained Croix. market share to maintain a healthy legged stool philosophy, Borusan believes Reliability is the third pillar of Borusan’s production level despite the falling demand that safety of its employees is the day-to-day strategy. It is manifested in, for oil rigs. It is leveraging its newest- paramount focus. In 2019, the firm among other things, the firm’s investment generation manufacturing equipment, achieved a total recordable incidence rate in information technology systems that industry-leading quality, production and of just 0.94, which it notes is substantially mirror companies many times its size. information technology systems to identify below an average pipe and tube industry Internal processes are supported by a team opportunities to diversify product rate of 4.7. By sponsoring an incentive staffed around the clock to help maintain offerings. In addition, the firm in 2019 program for preventative health and safety the firm’s real-time manufacturing tracking identified both vendors and customers that actions, “we have transformed the focus on system. By following all facets of the valued stable pricing and volume as a way to safety from a spectator sport to a production process, Borusan is able to work together in a “lower for longer” participation sport,” said Croix. Borusan accurately pinpoint delivery dates, resulting mutually beneficial relationship. invested in computer kiosks for employees in a greater than 95% on-time delivery Looking ahead, Borusan’s Croix to use to submit observation reports, performance. “Our IT systems are a big part acknowledged that tube and pipe which are a critical component to of the speed of service we are able to provide producers are facing a difficult market identifying and changing working our customers. From having detailed cost made even more challenging by the global conditions and/or employee behaviors. information at our fingertips when quoting pandemic, but his firm’s experience in With quality being the second leg on the or analyzing our efficiencies, to having the weathering difficult storms makes facing stool, Borusan has capitalized on its more cleanest and most well organized inventory the future a bit easier. “We as pipe than 60 years of production experience to in the business , to using our QR code labels manufacturers are all very much advance. In view of the contracting market for unique joint traceability in the field, our challenged by current market conditions. for energy products, Borusan has worked customers can rely upon us for speed and However, with the same strengths that with critical hot rolled coil and technology accuracy of the information they need in earned us this prestigious award, we are partners to bring new products and order to better serve their end-user built to survive in lean times. We services to the market. These customers,” Croix said. continued operating to serve our developments include introducing new IT Borusan’s recent response to a volatile customers during the last down cycle in solutions, utilizing technical staff and market is akin to looking at a glass that is half 2015 and 2016, and we will be there for facilities to provide the highest performing full versus half empty. On the supply side, them again,” he said.

September 2020 | Metal Market Magazine | 61 STRONGER THAN STEEL. We’re proud of our second consecutive Service Center of the Year win! More than ever, Reliance recognizes and commends all of the employees across our Family of Companies. This award reflects your steadfast commitment to safety and innovation, and your tireless dedication to service and excellence. Thank you, also, to our suppliers, customers, and communities. We’re in this together. Here’s to you all!

RSAC.COM Global Awards for Steel Excellence 2020 Winners

Service Center of the Year: Large Company » Reliance Steel & Aluminum Co. Size, geographical spread and diverse markets win through

value-added processing capabilities. To support its current and projected business, Reliance in 2019 achieved additional financial milestones. Record capital investments of $242.2 million were made as well as reducing its debt balance by $617.9 million and returning $201.3 million to its shareholders in the form of dividends and share repurchases. Joining Reliance’s family of companies in 2019 was Fry Steel Company, a distributor of specialty long bar products, representing the 67th acquisition since Reliance’s initial public offering in September 1994. And although 2020 is not yet over, Reliance reports that it is coping well with this year’s difficult market. In the firm’s second- quarter 2020 report, Reliance’s chief executive officer Jim Hoffman said: “Our ability to maintain a strong gross

RELIANCE STEEL & ALUMINUM & STEEL RELIANCE profit margin is the direct result of exceptional execution by our managers in In 2019, Reliance Steel & Aluminum Co. – details which attest to our deep the field. Our local managers continue to achieved multiple financial milestones as it commitment to relationships, providing leverage the significant investments we further emphasized its commitment to best-in-class service focusing on small, have made in recent years to expand our consistency and its customers. That local orders. Our largest customer value-added processing capabilities to consistency, coupled with the company’s represented only 1.0% of our net sales. In focus on higher margin business, and strong execution of its longstanding 2019, we had only 26 customers with appropriately price the value we provide business model through all cycles, enabled sales greater than $25 million,” he said. our customers by delivering the highest Reliance to capture, for the second Reliance also credits its strategy of quality products and services when consecutive year, the Large Service Center serving diverse end markets and needed. We reacted quickly to rapidly of the Year award for companies with more providing a wide range of products and changing business conditions and than $500 million of revenue. processing services, generally in small reduced our SG&A expense by 16.1% to Reliance had record net income of quantities and on a when-needed basis. offset the $553.6 million, or 21.5%, $701.5 million, record cash provided by For example, during 2019, Reliance decline in sales compared with the prior operations of $1.3 billion and celebrated service centers delivered over 5.24 quarter. We believe our operating its 25th year of trading on the New York million orders. Of those orders, 51% performance in this unprecedented Stock Exchange in 2019. Its net sales for involved processing services. Most of environment demonstrates the strength the year were $10.97 billion. Reliance’s service center customers are and resiliency of the Reliance model and Part of Reliance’s recent success has within a 200 mile radius of the Reliance our ability to successfully operate through come from its consistency for both service center serving them, and delivery all industry cycles.” products and services, with about 96% of is provided by the Reliance fleet of about Because of the Covid-19 pandemic, its orders coming from repeat customers. 1,750 trucks, some of which are leased, doing business has changed a bit, but “We believe we have an excellent thus providing quick delivery for many “Reliance continues to operate with an reputation in the industry on an smaller customers. increased focus on our core value of enterprise (Reliance-wide) scale as well as To guard against the cyclicality of the keeping our employees, customers, with our 75 distinct brands. We are metals industry, Reliance has diversified suppliers, and communities safe and known for our integrity and the quality its product range, end markets and healthy. It is our duty to all of our and timeliness of our service, which is a geographic reach. The firm is not stakeholder groups and to our economy to cornerstone of our business strategy since dependent on any particular customer keep providing value-added metal our founding in 1939,” said Stephen group or industry, thus lessening its solutions in support of essential industries Koch, senior vice president of operations. exposure to price and demand and services. Reliance’s longstanding Furthermore, in 2019, the average fluctuations or economic instability of business model, combined with our overall Reliance order size was $2,090, and particular customers, industries or diversity and our employees’ excellence in “about 40% of our orders were delivered suppliers. In addition, Reliance has made execution, gives us the resiliency to adapt within 24 hours from receipt of the order significant investments to increase its and succeed,” said Koch.

September 2020 | Metal Market Magazine | 63 Flack Global Metals proudly serves the North American market with a broad portfolio of ﬂat-rolled carbon, prepainted, stainless, and aluminum products.

We design and execute custom supply Our culture is founded on a chain solutions for a wide range of end disciplined drive for innovation and markets, including Appliance, Building excellence. We are passionate about Products, HVAC, Oce Furniture, delivering the best for our customers. Garage & Entry Door, Lighting, We are honored to be recognized by Transportation, and Containers. Fastmarkets. We want to acknowledge As the Next Generation Service Center, and thank those that were incredibly our team employs innovative strategies instrumental in making this award for original equipment manufacturers. possible – our customers, vendors, We are known as the industry leader of employees, and service providers. We ferrous risk mitigation pricing solutions. are extremely humbled and grateful.

flackglobalmetals.com Main: 216.456.0700 | Sales: 317.460.4279 Scottsdale | Cleveland | Chicago | Atlanta Global Awards for Steel Excellence 2020 Winners

Service Center of the Year: Small to Mid-size Company » Flack Global Metals Driving supply chain innovation through hedging and technology

Jeremy Flack is used to having his center. Therefore our selling prices are business termed unconventional, lower than the very large service because it is. Operating as a service centers but, through our supply chain center but without any physical space management techniques, we can to call its own, Flack Global Metals has provide many of the services the big earned a reputation for being an boys offer,” Flack said. innovator in the market – “the young Other recent improvements for the upstart who does things differently company include resolving customers’ than the establishment” – resulting in quality issues in less than two weeks, it being named the service center of the achieving 100% invoicing accuracy, year for small to midsize firms for the reducing unnecessary inventory, 2020 Fastmarkets Global Awards for fine-tuning selling and administrative Steel Excellence. costs, optimizing customer service and Flack, who serves as chief executive sales capabilities, and improving officer of the firm he founded 10 years business intelligence reporting. ago, operates a service center without Flack’s asset-light business was walls since it utilizes the space and originally based on the extensive physical assets of others to procure, high-quality toll processing network process and deliver a wide range of and in 2019, as we all know, there was a for processing flat-rolled steel and flat-rolled steel and aluminum great deal more ebb than flow. Risk aluminium. In 2017, the company products with an asset-light approach. management aided the health of our began to explore developing “We are a supply chain management company, and we find ourselves production capacity for what it viewed company that operates as a metals uniquely positioned between the large as an underserved niche in the service center,” he said. With a global service centers and the small marketplace. Specifically, it studied the network of suppliers and world-class companies who have little overhead feasibility of building the world’s first processing facilities, the company is and compete simply on price,” Flack 74-inch-wide, high-production, color able to supply myriad industries, which said. coating line – purpose-built to produce range from construction to automotive To reduce risk, the company’s coated surface and shape critical steel, and appliance to various commercial team consults with aluminium and stainless steel. After manufacturing and industrial customers and tailors pricing models to extensive exploratory work, applications. match the goals of each company. development of a business plan and the One of the foundations of Flack’s “Some of our customers need a search for an institutional partner, Big business model is the integration of high-volume product that cannot be River Steel (BRS) emerged as Flack’s risk management and hedging into its re-priced for 12 months, while others partner when its chief executive officer buying practices. Its risk team propels bid on large projects requiring David Stickler embraced the business business growth in two areas – guaranteed steel pricing months in concept. expanded commercial offerings to its advance but can’t commit to physically The concept expanded to encompass customers and the optimization of the take the material in advance. Hedging the development, on the BRS campus, company’s own profitability. “Our risk offers solutions for these customers,” of a technologically advanced coil management strategy is focused on he said. processing center. “Our facility design being ‘customer forward.’ We are able In addition to benefitting from risk creates an accountable supply chain to mitigate price risk with management, Flack Global Metals has solution for customers that doesn’t sophisticated, industry-leading market embraced four key strategies to exist today. The project provides hedging and provide personalized increase its offerings and profitability. extensive onsite processing by offering strategies for customers to protect It has emphasized new business painting, slitting, cut to length, and their profits and help manage cash formation, efficient monitoring of blanking services. We’ve combined an flow,” Flack explained. inventory control coupled with strict environmentally conscious design with Risk management plays an hedging procedures, enhancing optimal on-campus logistics for these increasingly crucial role during customer feedback mechanisms and value-added services, thus helping turbulent market conditions. While the new web attributes to expand reduce the carbon footprint and deliver largest service centers, those in excess customers’ access to product the highest efficiency by compressing of $1 billion in revenue, have greater information. the supply chain for customers who access to capital, buying power and Flack explains that not all metal need additional services before physical assets, the smaller firms are users are his target audience. “We are receiving their products for end-use,” more subject to market fluctuations. designed for repetition and volume. said Flack. Ground is expected to be “The value of our inventory ebbs and We are at a price point between the broken for the facility in 2021 with flows with the volatility of the market, steel mill and the traditional service operations commencing in late 2022.

September 2020 | Metal Market Magazine | 65 We attribute winning this prestigious award to our loyal associates. Thank you for your dedication to providing the best customer service, collaborating to solve problems, and most importantly for working safely every day. It is your hard work that has brought us to where we are today. To our customers, thank you for placing your trust in us to provide you the highest quality service in the industry.

precision-strip.com Global Awards for Steel Excellence 2020 Winners

Production/Processors/Fabricators of the Year » Precision Strip We attribute winning this prestigious award to our loyal associates. Thank you for Thriving trough toll processing and focused technology your dedication to providing the best customer service, collaborating to solve Precision Strip Inc. (PSI) is a 100% toll have been processor that sees its role in the metals encountering. problems, and most importantly for working safely every day. It is your hard work supply chain as being a problem solver, Wolf pointed that has brought us to where we are today. To our customers, thank you for placing offering its customers the specialty out that about processing services that they need to solve five years ago your trust in us to provide you the highest quality service in the industry. their problems even in very challenging the company business environments. was the first Joe Wolf, PSI’s president, said that it has processor in the been through his company’s focus upon the United States to “hard to do stuff,” including highly critical provide surface-quality applications, that the coil-to-coil laser business has succeeded. PSI has grown blanking, from one slitting line when it was founded enabling it to in 1977, to 54 lines at its 13 plants in six produce states, from which it shipped over 5.6 configured million tons of carbon steel, stainless steel, blank shapes aluminium and copper in 2019, particularly without having for automotive applications. to use STRIP PRECISION The specialty processing services that expensive dies. allows customers to electronically PSI offers have evolved over time to now He said that this blanking technology has communicate what the metal receipt and include oscillate slitting and such specialty proven to be great for automotive tooling consumption is at their operations and then blanking services as configured press trials and for low-volume production automatically generate fulfillment orders blanking and coil-to-coil laser blanking. At applications, including for the electric with PSI. the same time, it has expanded its logistics vehicle (EV) market, given that while there “These IT solutions are designed to give services through its fleet of 236 company- has been a lot of talk about the development us the flexibility we need to meet our owned trucks to be able to deliver the metal of new EV models, at least to date their customer requirements, including that it processes to its customers in a production levels remain relatively low. providing specifically requested just-in-time manner. Wolf said that PSI has also recently begun identification tags or specially generated precision-strip.com This growth, Wolf said, was helped by the offering the application of specialty reports,” Wolf pointed out. support that PSI receives from Reliance lubricants as well as enhancing its He said that PSI also continues to make Steel & Aluminum Co., which acquired PSI inspection of metal, including the strides across its operations to ensure that in 2003. “We were able to come out of the incorporation of inspection information the company is moving metal safely, noting 2009-10 financial crisis stronger than we into a two dimensional bar code for that has not only included adding additional went into it and I believe there could be downstream customers to use. “This is part safety equipment on its trucks and opportunity for us to also gain market share, of the enhanced quality services that we processing lines, but involves the education as our business gets closer to pre-Covid-19 provide,” Wolf pointed out. and training of the company’s associates, levels,” he said. PSI also has an internal information who are encouraged to take personal While many other processors are also technology (IT) group that has designed and responsibility for safety. more traditional service centers, also maintains the enterprise resource planning “Our company is also focused upon buying and selling metal, Wolf said that (ERP) business system that runs its Covid-related safety precautions and had PSI’s business model of being solely a toll operations and has such capabilities as an started to do so very early on, starting in processor, and therefore not owning their end-to-end scanning technology that is mid-March,” Wolf noted. In addition to a own metal, has worked very well for the used to ensure accurate metal type lot of cleaning and social distancing, that has company over the years, helping it to avoid identification throughout the processing included separating its associates into pods conflicts of interest. Wolf explained that lifecycle. It also has: an advanced surface – small groups of employees who stay because its mill customers do not have to inspection app that is used to consistently together, work together, take breaks worry about it getting in the middle of their and accurately capture quality defect together, etc. – which makes contact transactions with OEMs, that has been a big information of the base metal; extensive tracing a lot easier. This fits with the differentiator for PSI. electronic data interchange (EDI) trading company’s general philosophy of treating Wolf said that another way that PSI has capabilities that resulted in 4.5 million its people right. “That is why historically differentiated itself from other processors is transactions with PSI’s customers in 2019; our employee turnover has been extremely that through its own engineering unit the Level 2 PLC integration with the low,” he added. company designs and builds all of the company’s processing line to ensure that Wolf said that PSI wants to continue to processing equipment that it operates itself, the right processing specifications are leverage the support that it gets from enabling it to customize the equipment applied mechanically as opposed to being Reliance to both grow further and continue with technology that meets customers’ applied through human intervention; and a its tradition of enhancing value for its requirements and solves any problems they vendor-managed inventory portal that customers.

September 2020 | Metal Market Magazine | 67 THANK Safety Global Awards for Steel Excellence Culture

2020 WINNER STEEL PRODUCER OF THE YEAR YOU

Lorem ipsum We are honored that Steel Dynamics was recognized Customer Commitment as the Fastmarkets 2020 Global Steel Producer of Global Awards for the Year. The entire Steel Dynamics team achieved an outstanding performance duringSteel 2019, Excellence and we are thankful to all who have contributed to the safety Growth and performance of our growing company.

We thank eachLorem ipsum and every oneLo remof ipsum our valued team members for their passion, innovation, and dedication to excellence. We are also grateful for our loyal Innovation customers, vendors, communities, and shareholders.

Founded in 1993, Steel Dynamics is one of the largest and most diversified domestic steel producers and Financial Strength metals recyclers in the United States.

steeldynamics.com

STLD_0179_August_DriveGrowth_AD_082820.indd 1 8/28/20 4:23 PM Global Awards for Steel Excellence 2020 Winners

Global Steel Producer of the Year » Steel Dynamics Thriving even in the toughest of times

Steel Dynamics Inc. (SDI), which is currently the fourth largest US steel producer with the capacity to ship 13 million short tons of steel per year, has seen solid, targeted growth over its 25 years of operations and, despite the current challenging business environment, the steelmaker believes that it is well positioned for further profitable growth. Mark Millett, SDI’s president and chief executive officer, said its business model has enabled the steelmaker to differentiate itself from its peers, which he said is very important given that the steel industry is a very cyclical commodity market. “Our business model and our entrepreneurial culture that has been at the core of our success has demonstrated that we can thrive even in the toughest of times,” Millet said. DYNAMICS STEEL While he acknowledged that SDI has “Also, I don’t believe that our success installation time and cost.” SDI has also been impacted by the economic impacts of has just been driven by the state-of-the-art entered the pre-paint business, making it a the Covid-19 pandemic, he said that he technology in our facilities,” Millett said. company having paint lines contiguous to believes that the biggest challenge for both “Rather, it is managing that technology its steel mills. SDI and for the industry overall is the and creating a culture in which to exploit it The company’s growth is also in part volatility in the steel market, which, driven that has been the differentiating force transformational in nature, as is so for its by global steel overcapacity, has been within SDI.” Columbus, Mississippi, sheet mill, which, increasing and is likely to continue to persist Millett said the company’s growth over when SDI bought it in 2014 was energy for some time. the years has been very targeted and pipe and tube dependent, but over the past “But my message to our team is that intentional. “We haven’t grown to just get four years has been transformed by SDI, while we are hoping that the economy will bigger. We’ve grown to enhance our margin most recently by adding a third galvanizing come back up strongly and that we hope capability,” he said, explaining that SDI’s line, to also serve the US and Mexican auto that we will get trade relief, we can’t manage expansions tend to be downstream and high markets. our business just on hope,” Millett value-added. That, he noted, includes at its “Our largest growth project right now is explained. “We have to create a business building systems and fabrication the Sinton, Texas, greenfield facility that model that allows us to adapt, react and be operations, as well as expansions at its will add about 3 million tons of new capacity successful in all markets.” Heartland and The Techs facilities. to our portfolio when it comes online in Millett said that SDI’s founding “We actually convert about 2 million tons mid-2021,” Millett said, adding that while principles, which include having a diversified of steel a year through those downstream there has been concern about new steel portfolio and a culture and a team that drives operations,” Millett said, noting that while capacity coming online in 2021-23, “We low-cost operations, does that. “At the end of in good times they buy steel from whoever aren’t just adding capacity. We will be the day, the low- cost producer of quality they want, in tougher times more of that offering differentiating products from that products is going to be the survivor,” he said. steel is bought in-house. “That allows us to mill that are currently unavailable in the US “But we have done more than just that. We flex our steel volumes up and down and to today, he said, adding that the mill will offer don’t just survive. We thrive, even during maintain consistent relationships with our many Southwest OEMs a steel sourcing tough market conditions.” customers,” he explained. That also helps solution that is not available to them He said that SDI’s key foundational SDI to have higher capacity utilization rates currently. “It will also be able to serve the differentiator has been its ability to sustain through various business cycles. He pointed growing sheet market in Mexico and have a its superior operating culture – one that has out that even during the second quarter of very effective freight rate to the West allowed it to offer solutions to provide its this year, in the middle of a pandemic, SDI’s Coast,” he said. customers the value that they are looking overall capacity utilization was about 80%, Helped by its team of employees, which for – even as the steelmaker grows. This, with its sheet mills running at about 90%. he said have been a big driving force for the Millett said, can be challenging, especially The company’s growth is also connected company’s success, Millett said he believes given that company’s growth not only came to SDI’s push to chase innovative supply that SDI will continue upon this path. “We through new greenfield facilities and plant chain solutions. Millett said one example of still have a lot of ideas and a strong balance expansions, but also through the acquisition that is its welded rail business. “Today, we sheet, so I am confident that we are going to of new companies with different business ship welded rail in lengths of about a quarter continue to grow and succeed,” he cultures than SDI’s. of a mile long, which saves our customers concluded.

September 2020 | Metal Market Magazine | 69 Industrial Minerals Andalusite seeks new balance amid supply, demand shifts weeks. Sources active in the market The andalusite market has been rocked by a drop in estimate around 15,000 tonnes of supply following closures related to Covid-19 in supply may have been lost in total between the two. producing countries and a subsequent adjustment Peru, another main supplier of the material to the international market, in demand in some consuming markets, but also halted operations during a temporary closure for more than sources believe a new balance is in sight, reports one month. Sources in the market Davide Ghilotti estimated a loss of output of about 4,000-5,000 tonnes in Peru during The first half of this year was production to a standstill between the closure period. marred by a series of mining March and April. Market sources Production is now understood to closures and logistical issues in estimated that global output could be back on track in all origins, with major origins of andalusite, the be as much as 20,000 tonnes lower miners ramping up and trying to refractory raw material. this year, although some estimate it recover some of the previously lost Andalusite miners in South Africa to be closer to 25,000-30,000 volumes. “Production is about 85% and Peru were hit by nationwide tonnes lower. of normal now, but [international] lockdowns imposed by their Andalusite Resources and demand appears to be strong,” one respective governments to try to Imerys, the two producers with producer said. contain the spread of the Covid-19 operations in South Africa, were “We are gradually recovering virus. This brought andalusite affected by a closure of almost five from the lost time and we are

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70 | Metal Market Magazine | September 2020 meeting our existing orders,” steel, automotive and industrial 'There is now suppliers and origins – tends to be another producer added. markets. Sources, however, believe broadly in line with general Some market prices saw a supply may have dropped further an equilibrium demand. Contracting is, for the marginal upwards adjustment as a than demand and tightness could between most part, settled on long-term result of the pressure on supply still characterize trading conditions what we are agreements which are mainly triggered by lower output and in the coming months. One supplier yearly or half-yearly, compared logistics disruptions. Fastmarkets estimated a drop in demand of producing and with a comparatively small spot assessed the price for andalusite 57% around 5,000-8,000 tonnes, the orders we market. This means that free stock Al2O3 min, cif Europe at €320-440 compared with “at least three times have' volumes tend to be lower than in ($377-519) per tonne on May 28, up more in terms of lost supply.” other refractory markets that rely from €310-430 per tonne on These conditions were reflected more on spot trading. Price February 27. in the higher Fastmarkets fluctuation, as a result, is limited in “Logistical issues, delays all over assessment price on a delivered this market compared with other the place and, generally, less material Europe basis. raw materials. are all affecting delivered prices into The fundamentals of the sector At the time of writing, demand is main markets,” a consumer concurred to support a degree of seen as recovering to an extent. commented at the time. Meanwhile, balance between supply and “We saw demand falling slightly Fastmarkets’ quarterly andalusite demand even amid the current in some markets but increasing in 57% Al2O3 min, fob South Africa conditions. Global andalusite others,” one seller said. assessment was stable at €260-340 output is estimated at about “Considering the lower output, we per tonne on May 28. 300,000 tonnes per year, according don’t expect much of an imbalance to industry sources in contact with after all.” Shifting demand Fastmarkets. This volume excludes “There is now an equilibrium At the same time, supply was only China, where a couple of local between what we are producing one part of a two-sided problem operations reportedly add some and the orders we have. We don’t affecting the andalusite sector. 10,000-15,000 tpy, all consumed have any volumes unsold for the Demand, in particular in key domestically. rest of the year,” another supplier consuming markets such as Europe, In contrast with other refractory said. “Prices are steady and in took a hit as refractories producers raw materials, such as magnesia or certain markets we could even sought to review their purchasing graphite, andalusite supply – as it achieve a marginal increase,” the plans in light of poor-performing is controlled by a small number of supplier added.