Offering more sophisticated products, a steel mill expands its target markets

September 2012 - With a state-of-the-art facility, Calvert, Ala.-based ThyssenKrupp Steel USA LLC is expanding its customer base as the company becomes qualified to produce high-quality steel products to meet specifications and tolerances for the automotive, appliance and energy industries.

The company currently employs 1,600 workers, and at full production, is expected to process 4.3 million metric tons of carbon steel annually. As production ramps up, ThyssenKrupp Steel USA continues to reach for production records and increased efficiencies. The company is seeking growth opportunities in challenging segments of the marketplace. According to Bob Holt, vice president of sales and marketing, the company offers customers hot-rolled, hot rolled pickled and oiled, cold-rolled (annealed and full hard) and hot-dipped galvanized products. Cold-rolled products particularly are important to the success of the facility and will complement its widely accepted hot-rolled products.

“Most of our initial order activity came from the distribution segment, with service centers and exporters as the primary targets to move the products into the marketplace,” Holt says. The company has significantly increased business with appliance OEMs, heavy equipment, agriculture and HVAC manufacturers. Recently, it has picked up business from the energy industry, including steel for pipe and tube production for oil and gas transmission lines and OCTG applications.

“With several large pipeline projects under construction, we feel good about those energy opportunities,” Holt says.

The Alabama facility is a joint venture with Vale, based in Brazil, and is capable of 5 million metric tons of slab production per year.

These slabs are processed through the hot-strip mill, followed by production at the cold-rolling mill, ending the final production downstream at the hot-dipped galvanizing lines. The hot-strip mill produces high-quality carbon steel hot-rolled coils in thicknesses ranging from 1.5 millimeters to 25.4 millimeters.

The continuous pickle line can produce up to 1.1 million metric tons of high-quality hot rolled pickled and oiled coils, intended to be the new industry standard for surface and flatness. The continuous pickler-tandem mill can produce 2.5 million metric tons of high-quality cold-rolled full hard in thicknesses ranging from 0.3 millimeter to 3 millimeters for further processing into exposed and unexposed applications after annealing.

ThyssenKrupp Steel USA’s mill has been running for nearly two years. It was designed with high tolerances in mind, removing the need for upgrades in the immediate future. “Our emphasis has been to get the mill started and then simply enhance what we have in terms of capabilities,” Holt explains. “We’re not currently making any further investments because we don’t think they are needed.”

Like any startup, the mill faced challenges and has made good progress with its IT systems, which are “one of the most challenging areas for any startup,” Holt says. “We input a lot of resources in that area and are happy with the results.” When working with tight tolerances and various product lines, a streamlined, cohesive IT system “is where we’ve invested a lot of time and resources,” he says.

New tolerances, new opportunities

ThyssenKrupp Steel USA continues to expand its customer base and recently began the complex qualification process to enter into the automotive supply chain. “We always knew the automotive industry would be the last market we penetrate due to the complexity of the products as well as the duration of the qualification process,” Holt says. “Since starting the qualification process, we’ve achieved 100 of 135 different product, grade and customer-specific submittals in the first six months.”

Holt says ThyssenKrupp Steel USA expects to complete the entire 135 submittals by the end of the company’s fiscal year in September 2012.

The company currently offers hot-rolled coils, cold-rolled coils, hot-dipped galvanized and galvanneal coils, which is expected to be complemented with the production of aluminized and Galvalume coils in the near future. ThyssenKrupp Steel USA produces a full range of steel grades, including mild steels, high-strength and advanced high-strength steels, as well as higher carbon and structural steels.

“In the course of the next fiscal year, we expect to shift shipments to include 300,000 metric tons of high-quality light flat-rolled products to support the automotive industry,” Holt says. “The automotive industry will become an important segment for us, and the plan includes a volume of over 1 million metric tons of shipments in 2015 to that consuming industry.”

According to Holt, ThyssenKrupp Steel USA already is producing exposed and unexposed products and has contracted additional volumes for exposed galvanized and galvanneal tons in its future production models. “We’ve been moving in that direction and plan to continue to move into more sophisticated markets,” Holt says. “I am optimistic that we are going to grow.”

The need for high-quality exposed hot dipped galvanized and galvanneal products in the automotive markets will be the most critical test for the Alabama facility to date, says Holt. “The marketplace is not very forgiving,” and failure to meet standards is not an option, he says. With high expectations, the company must produce near-perfect products and scores in order to be successful in these market segments. The company is in the early phases of producing high-strength steels and expects to be fully qualified in the coming months for these products.

Proven abilities

ThyssenKrupp Steel USA currently is in the process of making advanced hot-rolled products to support specialized ERW and spiral-welded pipe applications and satisfy the increasing need for energy in the NAFTA marketplace. These products use high-strength low-alloy grades and a unique rolling and cooling process.

In order to meet tube and pipe requirements, the company has worked to complete products for transmission lines, gas lines and water lines. “All require high-strength rigs to meet different specifications depending on the customer’s needs,” Holt says. “Everyone has their own recipe to achieve certain properties. As far as the automotive industry goes, it’s not so much the difficulty of making the parts, it’s making sure you have a consistent process and you can prove to auto companies that you have procedures in place to supply them with consistent, high-quality products.”

Holt says requirements for customers from other industries, such as service centers, are different. “You don’t have to be as precise in the mill. You need to produce a good product but the automotive sector requires very particular specifications for that product. That’s why products for the automotive industry take such a long time,” Holt says. “It’s the whole qualification process. You have to submit a package of data that can be very comprehensive. You have to demonstrate capability at the stamping plant, at the assembly plants as well as welding before you’re qualified to sell automotive.”  MM

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