SSAB America has announced it will immediately begin prioritizing production of steel designated for use in local, state, or federal-level COVID-19 disaster relief programs or projects.
The company will process these orders under Relief Effort Priority (REP) to streamline the production process and accelerate their finishing, shipping, and logistics to ensure prompt delivery.
Ivonne Furneaux, director communications and community relations, SSAB Americas, told Davis Index that SSAB has not encountered nor does it anticipate disruption to its production or services.
As a critical manufacturer, SSAB is committed to continuing operations and supporting efforts to combat the COVID-19 pandemic, Furneaux said, adding that the REP program was developed to ensure steel orders destined for COVID-19 relief projects are expedited through the manufacturing process.
In 2019, SSAB Americas was the largest producer and supplier of heavy plate in North America with a market share of around 27pc out of the total 10mn mt market for the product, according to SSAB estimates. The company plans to increase its market share in this segment to 39pc by 2022.
The magnitude and exact volumes in correlation with the COVID-19 REP projects is yet unknown. The Trump Administration has enacted stimulus packages for individuals and is discussing infrastructure investments.
These projects could be beneficial for SSAB’s strategy to increase its market share given their production ability of specialty materials for heavy fabrication and construction equipment.
SSAB Americas comprises 23pc of SSAB Group’s total sales and 44pc of the Group’s total EBITDA. The US accounts for about 85pc of sales, Canada 10pc, and Latin America 5pc.
The company’s Mobile, Alabama and Montpelier, Iowa production sites are nearly 100pc scrap-based and have a combined capacity of 2.4mn mt. They produce quality heavy steel plate and coil. In addition to the two steel mills, SSAB Americas operates three cut-to-length facilities in Texas, Minnesota, and Canada that process SSAB domestic steel or imported steel.
SSAB Europe will lay off some personnel at its Finnish operations for an average of three weeks during April-June due to the weakened market situation resulting from COVID-19, the company announced recently, as it contemplates cutting steel production capacity in line with weakened demand.