Nucor Corporation announced August 26 that it plans to begin steel bar production at its previously idle rolling mill in Kingman, Ariz. Nucor expects capital improvements necessary to restart production to total about $30 million and expects rolling operations to begin in Kingman by the second quarter of 2009. Initial annual output of straight-length rebar, coiled rebar and wire rod should be about 250,000 tons. The Kingman mill will have the capability to increase annual production to more than 500,000 tons.
Nucor acquired North Star Steel's idled Kingman steel mill in 2003 for a purchase price of approximately $35 million. In 2004, Nucor decided that Kingman's melt shop would not be restarted and recorded a $13 million impairment charge for the melt shop assets. Kingman's rolling mill assets have been held available for restart whenever market conditions warranted. The decision to start rolling rebar and wire rod products is driven by growing demand in the southwestern U.S. market from both Nucor's outside customers and Nucor's expanding downstream rebar fabrication business. Kingman's very attractive capital cost for rolling steel will be leveraged by excess low-cost melting capacity at our existing bar mills.
Dan DiMicco, Nucor's chairman, CEO and president, commented: "Startup of our low-cost rolling mill in Arizona is an exciting growth project in the very attractive southwestern U.S. market for rebar and wire rod. Nucor Steel Kingman LLC will build upon Nucor's position as North America's largest rebar producer. The restart of this facility expands our highly successful vertical integration business model."
Headquartered in Charlotte, N.C., Nucor makes more steel in America than any other company. Nucor and affiliates are manufacturers of steel products, with operating facilities primarily in the U.S. and Canada. Products produced include: carbon and alloy steel – in bars, beams, sheet and plate; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; light gauge steel framing; steel grating and expanded metal; and wire and wire mesh. Nucor, through The David J. Joseph Company, one of the leading scrap companies in the U.S., also brokers ferrous and nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.
