Banner
News

ATI and Tsingshan to form innovative stainless steel joint venture

November 9, 2017 - Allegheny Technologies Incorporated today announced that it has reached a definitive agreement to form an innovative 50-50 joint venture (JV) with an affiliate company of Tsingshan Group. Tsingshan is vertically integrated and is the world’s largest stainless steel producer. Formation of the JV is subject to customary regulatory and anti-trust clearances, which are expected by the first quarter 2018. The JV will manufacture and sell 60 inch-wide stainless sheet in North America. First shipments are expected in early 2018.

“As we have stated over the last two years, our strategy is to first return our Flat Rolled Products (FRP) business to profitability, and then position our FRP segment for sustainable profitability regardless of raw materials costs or trade policy,” said Rich Harshman, ATI’s Chairman, President and Chief Executive Officer. “We believe this innovative joint venture combined with the strategic actions and cost reduction initiatives taken over the last several years lays the foundation to achieve this objective.

“This joint venture benefits ATI and Tsingshan as well as our customers in the North American stainless market. Tsingshan’s capabilities to produce stainless steel slabs using its unparalleled vertically integrated mining, refining, and casting assets combined with ATI’s innovative, low-cost Hot Rolling and Processing Facility (HRPF), and the JV’s unique Direct Roll Anneal and Pickle (DRAP) facility creates a cost competitive supplier of stainless sheet products for the North American market.

“For ATI, the conversion agreement volume will significantly increase the utilization of our HRPF and will utilize the previously idled DRAP finishing facility in Midland, PA, which will be owned and operated by the joint venture.”

Key points of the joint venture:

  • Allegheny & Tsingshan Stainless is the joint venture company’s name.
  • Tsingshan’s operation in Indonesia is vertically integrated from mining raw materials, including ferronickel and ferrochrome, through refining and casting. Tsingshan will supply the JV with redi-to-roll slabs with reduced raw material cost volatility.
  • The Tsingshan-supplied stainless slabs will be hot-rolled into coils on ATI’s HRPF under a conversion agreement between ATI FRP and the JV. The HRPF provides customers with the market’s most consistent quality and edge-to-edge, tip-to-tail gauge control.
  • The hot-rolled coils will be finished into stainless sheet using the JV’s DRAP line, which is ATI’s major investment in the joint venture. The Midland operations’ assets were impaired in 2015 and the DRAP finishing line was idled in early 2016.
  • The JV is expected to add approximately 100 manufacturing jobs in Western Pa.

“Tsingshan has built the world’s newest and most innovative stainless production facilities,” Harshman continued. “Our HRPF provides unsurpassed coil quality and is a modern, low-cost facility. The JV’s DRAP line is an efficient continuous automated facility. It is the only one of its kind in North America that completes the finishing process in minutes rather than the weeks required by the conventional finishing path.

“As one global supply chain, the joint venture will provide a highly competitive and uniquely differentiated offering.”

View source version on businesswire.com > 

LATEST ISSUE 
MM Cover0917 digital

vert-current-linewhiteNovember 2017

FULL CIRCLE

A European aluminum producer boosts capacity by 50 percent and becomes more sustainable with high recycling rate.

> READ THIS
MONTH'S ISSUE

Instagram - @ModernMetalsMag

MM digitaal archive banner 330

Modern Metals on Twitter

Banner

TrendPublishing 6 16 mm

Instagram Icon Large twitter facebook linkedin rss

MM Cover0917 preview FFJ Cover0917 preview mm 0917 brandingcovers2 3 2 Consumables 0917