ArcelorMittal starts Brazil blast furnace revamp early on ‘market conditions’

ArcelorMittal has begun the revamp of a blast furnace in Brazil earlier than planned, and has also temporarily stopped operations at a rebar facility in the country due to market conditions.

On June 23, the company started a 70-day maintenance outage at its No2 blast furnace in Tubarão, in the southeast Brazilian state of Espírito Santo.

The stoppage had been planned for August-September.

The reason for the change was “market issues,” according to the company.

The Tubarão unit is an integrated steel facility which produced 7 million tonnes of crude steel in 2018. The facility produces slabs and hot-rolled coil.

The export price of Brazil-origin slab has been falling because of weak demand and low prices for flat steel products globally, while the costs of raw materials have remained strong.

Fastmarkets’ weekly assessment of the export price for Brazilian slab was $415-425 per tonne fob on June 28, compared with $425-440 in the previous week.

The No2 blast furnace has been operating for 21 years, and ArcelorMittal plans to replace the furnace’s refractory materials, to improve its cooling system and to restore the electric supply mechanisms.

ArcelorMittal has also stopped production for 20 days at a mini-mill rebar production unit in Piracicaba city, in the country’s southeastern São Paulo state. The facility has capacity for 1 million tonnes per year of rebar.

It has granted collective holidays to 230 employees, from June 26 to July 15.

The stoppage in Piracicaba was due to “the difficult [situation facing] the steel sector in the country,” ArcelorMittal said.

Rebar prices in Brazil have been falling amid weak domestic demand and tough competition among producers.

Fastmarkets’ assessment of the domestic rebar price was 2,450-2,600 Reais ($641-680) per tonne delivered on June 7, down from 2,600-2,720 Reais per tonne a month earlier.

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