Dec 22 2006
Commercial Metals Company, headquartered in Irving, Texas, announced plans to construct a steel manufacturing facility, a "Micro Mill," in the greater Phoenix, Arizona area. The Micro Mill is a "continuous continuous" design where metal flows uninterrupted from melting to casting to rolling. It is more compact than existing, larger capacity steel minimills taking advantage of both lower initial capital construction costs and ongoing operating efficiencies by focusing on cost-effective production of a limited product range. It is anticipated that the project will cost approximately $130 million with production anticipated to commence in early 2009, contingent upon the successful completion of site, regulatory, environmental and permitting issues. The Micro Mill, when completed, will be a "focused factory" designed to produce primarily reinforcing bar. It will have an estimated capacity of 280,000 tons per year and will create approximately 110 new jobs for the area.
Russ Rinn, President and CEO of the CMC Steel Group, said, "CMC has worked closely with Danieli to jointly develop an innovative combination of proven technology that will result in a highly efficient, lower capital and operating cost facility. The Micro Mill will market to a localized, underserved rebar area and is intended to vertically integrate with our expanding downstream fabrication operations in the Pacific Southwest. The greater Phoenix area continues to grow, has an abundant supply of scrap and a solid construction market which will provide good access to locally generated raw material and nearby end-use markets. We are also pleased that our agreement with Danieli contains provisions which provide CMC, as the first industry participant utilizing this innovative concept, the right to replicate the Micro Mill in other suitable locations."
Commercial Metals Company President and Chief Executive Officer, Murray McClean, added, "As we continue the execution of our growth objectives, we constantly evaluate the merits of greenfield opportunities versus the purchase of existing capacity. The current market conditions for acquisitions have convinced us that building this first Micro Mill is the most economic method to achieve our objectives."