MMK Metalurji to start producing its own HRC again in Q3

The Iskenderun-based plant will restart HRC production in September 2021 after almost nine years of operating solely as a reroller.

“We have made a decision to go ahead with launching the hot end [and] we have started preparatory works [on commissioning the electric-arc furnace],” MMK chief executive Pavel Shilyaev said in a conference call on Wednesday April 21.

“We have set up a timeline for raw materials purchases, the workforce [and] the working capital. We estimate to be able [to restart the hot-end] in about four to four-and a half months [from now]. The overall expected [HRC] output will be about 2 million tonnes per annum,” he added.

At the moment, MMK Metalurji operates a 750,000-tpy cold-rolling mill, a 900,000-tpy galvanizing line and a 400,000-tpy color-coating line.

Traditionally, around 70% of HRC that MMK Metalurji receives comes from the parent company in Russia, while the other 30% is purchased in the local Turkish market.

MMK Metalurji stopped operations at its meltshop and compact strip mill in late 2012. The combined operation had the capacity to produce 2.3 million tonnes of hot-rolled material per year. Operations were halted because of the low achievable prices for HRC, while scrap and energy costs had risen significantly. 

Market fundamentals
MMK has previously made announcements about the restart of the Turkish plant’s hot-end production, but sources said that, this time, the operations will actually be brought back on stream, due to favorable market fundamentals.

HRC prices in Turkey and globally have been steadily rising since February this year, reaching four-digit levels in mid-April.

Fastmarkets’ weekly price assessment for steel hot-rolled coil, domestic, exw Turkey, was $1,030-1,050 per tonne on April 22, rising from $1,020-1,030 per tonne on April 16. The assessment averaged $881.25 per tonne ex-works in March and $760 per tonne ex-works in February this year.

Cold-rolled and hot-dipped galvanized coil prices have also been soaring globally, driven by shortages and strong demand.