Rouge Steel?

From: Mike D.
Location:
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Remote Name: 68.40.133.241
Date: 03/31/04
Time: 05:16:03 PM

Comments

Original story going around was to phase out the furnaces, go to electric furnaces melting scrap and supplement that with imported slabs from Mother Russia. News article stated that the Blast furnaces have been the big reason Rouge Steel has been losing money the last few years. Now, with China sucking in steel, scrap, raw materials, coke like a black hole, that idea may be either shelved or put off at least for the foreseeable future. There was a plan a few years back for Rouge Steel to go "electric" and scrap the Blast Furnaces as Ford would like them out of there with their evironmentally friendly plan for the area, but the plan hinged on getting loans and Ford also told Rouge they were on their own when Ford starting losing money itself the last couple years. Ford had been covering the pension for Rouge and some other areas. The state of Michigan made an offer to cut taxes on the raw materials from Marquette as an incentive for rouge to keep the furnaces running and keep mining jobs in the UP going. So with demand for finished and semi-finished the way it is now and its assumed this will last a year or two until the china situation stabilizes and things will settle down, they may keep running them for the foreseable future. Interlake and Cleveland-Cliffs have to be holding their collective breaths as shutting down those furnaces is gong to take a big chunk out of their business. The problem with the Rouge furnaces is they are not considered large by industry standards and costs more per ton to make iron. Modern furnaces overseas in Japan and new ones in China are approaching 50 foot hearth size and more and the Rouge furnaces are just to small to be cost-competitve on the world market at 30 feet plus. With scrap prices at all time highs and shortages occuring the all electric option is not feasable either, so I would guess the furnaces will run for a while until things settle down on the world market. Rouge has had a horrible safety record with the furnaces the last few years with them exploding or malfunctioning. Time will tell!