RHI Magnesita (RHI) plans to invest €30mn ($25mn) to install a rotary kiln in its mining unit in Brumado, Bahia, Brazil.
The new kiln will enable the production of new raw materials used to make refractory products for steelmaking. The raw materials will include noble sinters for international sales and will provide value-added products to customers in the Brazilian market, RHI Magnesita said in a press release on Thursday.
The new technology is expected to increase Brumado’s productivity by more than 30pc with the option of doubling the production capacity through the company’s magnesite Pedra Preta mine also in Brumado. The rotary kiln installation is expected to extend the lifetime of the Pedra Preta mine to 120 years.
The company noted support for the investment from a considerable recovery in the steel and cement segments in Brazil in the past few months.
RHI expects worldwide demand to remain subdued in Q3 with a limited outlook into Q4. The company’s revenues decreased by 23pc in H1 2020 to €1.2bn from H1 2019 with steel revenue declining by 22pc and industrial revenue falling by 24pc, during the same period. The refractory segment’s margin was 9.1pc in H1 2020 down from 9.5pc in H1 2019. Profit before tax was €70mn in H1 2020, down 58pc from €165mn in the same period in 2019.