Metals

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SDI to acquire Mexican recycler

Steel Dynamics Inc. (SDI), Fort Wayne, Indiana, has announced that it has entered into a definitive agreement to acquire 100 percent of the equity interest of Zimmer S.A. de C.V., Monterrey, Mexico, to be funded entirely with available cash. Zimmer operates a ferrous and nonferrous scrap metals recycling business.

According to SDI, the acquisition will help with its procurement strategy to support its new electric arc furnace (EAF) flat-roll steel mill in Sinton, Texas.

Zimmer’s primary operations include six scrap processing facilities positioned near high-volume industrial scrap sources located throughout central and northern Mexico. The company also operates several third-party scrap processing locations. These combined facilities currently ship about 500,000 tons of scrap annually and can process approximately 2 million tons annually, SDI reports.

“We look forward to welcoming Zimmer to the Steel Dynamics family to further solidify our Southwest U.S. and Mexico growth strategy,” says Mark D. Millett, president and chief executive officer at SDI.

He adds, “Combined with our existing metals recycling presence in Mexico, the addition of Zimmer provides an expanded commercial presence in the region and strengthens our raw material supply strategy, allowing for cost-effective ferrous scrap procurement for our new Texas flat-roll steel mill. Zimmer provides a platform to grow our metals recycling presence in Mexico, representing a meaningful achievement in our raw material sourcing strategy for our Texas steel mill, which is currently under construction and expected to begin operations midyear 2021.”

According to SDI, this transaction is subject to customary closing conditions and receipt of required regulatory approvals.

Tesla applies for new aluminum alloy patents

Palo Alto, California-based electric vehicle maker Tesla Inc. reportedly has invented new aluminum die casting alloys designed to maintain high-yield strength and high conductivity while performing in vehicle component roles.

According to Electrek.co, Tesla has applied for a patent on the new alloys, developed in a joint effort by the company and Space Exploration Technologies Corp. to “develop new advanced materials for their respective products.”

Regarding the suitability of the alloys for die casting, Tesla writes of one of them in its patent application, “The alloy has the proper fluidity to ensure that [it] wets the entire length of a mold and the mold is properly formed. The alloy resists hot-tearing and retains the desired yield strength when the cast solidifies.”

Davis Index aims to serve global metals markets

Davis Index, headquartered in Singapore, has launched what it calls “the world’s only market intelligence publication built solely for the metals recycling industry.” Davis Index founder and CEO Sean Davidson says the service became available as of Feb. 24.

The service includes more than 900 price indexes for 80 countries, as well as metals futures prices and other reference data. Davidson says the platform will cover markets in the United States, United Kingdom, Germany, Spain, India, Pakistan, Bangladesh, Japan, South Korea and Vietnam with “hyper-local” coverage.

“In terms of depth and breadth of coverage, accuracy, cost and functionality, Davis Index is in every sense a disruptor,” Davidson says. “Existing services are frequently inaccurate and consistently overpriced. The recycling industry needed a tool that represents the materials they actually trade—a tool that it can access and use in its efforts to preserve and improve margin.”

Davis price indexes will focus on ferrous and nonferrous “free-market scrap metal and secondary alloys that are not listed on exchanges but drive global trade,” according to the company.

Davis Index will publish nearly 800 metals price indexes on a weekly basis, 90 daily indexes and more than 100 monthly indexes, according to the firm. Data are available through a web platform and through twice-daily reports. Both reports and access to the web platform are being offered at $799 per year, per user. The fee also includes functional licenses to use the data in contracts.

Novelis’ net sales decrease in Q3 of 2020

Aluminum rolling and recycling company Novelis Inc., Atlanta, a part of the Mumbai-based Aditya Birla Group, has reported net income attributable to its common shareholder of $107 million for the third quarter of its 2020 fiscal year. In the prior-year period, that figure was $78 million. Excluding tax-effected special items in both years, the company reported net income of $132 million in the third quarter of fiscal 2020 compared with $101 million in the prior-year period. This 31 percent increase is primarily because of higher adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), the company says.

Its net sales decreased 10 percent from the third quarter of 2019 to $2.7 billion for the third quarter of fiscal 2020, Novelis says, driven by lower average London Metal Exchange (LME) aluminum prices and local market premiums. At 797,000 metric tons, flat-rolled product shipments were in line with the prior year.

“Novelis continues to perform very well both operationally and financially, delivering another set of strong results in the third quarter,” says Steve Fisher, president and CEO at Novelis. “At the same time, we have made excellent progress advancing our major organic expansion projects in the U.S., China and Brazil, allowing us to continue to grow with our customers and better compete against steel and other materials.”

Each of these projects continues to progress on time and on budget, according to the company. Its greenfield automotive finishing plant in Guthrie, Kentucky, is in the commissioning process, with commercial shipments to customers expected to begin in the coming months.

July 26, 2018, Novelis announced it had signed a definitive agreement to acquire Aleris Corp., Cleveland. The company initially had said it expected to close the transaction by Jan. 20 of this year. While Novelis has received approval from antitrust regulators in China, the U.S., and the European Commission (EC) to close the transaction, the company must divest some operations to appease regulators.