Metals, Financial

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Ohio foundry prepares for aluminum furnace startup

Hubbard, Ohio-based Ellwood Engineered Castings has been following through on plans announced in 2018 to add an aluminum castings furnace to diversify its traditional iron foundry business.

A video segment posted to the Youngstown, Ohio-based Business Journal Daily website includes a tour of the new Ellwood aluminum casting line’s raw materials staging area, showing scrap metal and primary aluminum ingots and sows that will be used as feedstock.

The video clip features interviews with Jeff Nicol, Ellwood vice president of technical sales, who says the facility is preparing to begin producing castings in August. The scrap shown in the video includes aluminum wheels and aluminum sheet scrap. Nicol indicates the metals will be purchased and stored in a segregated fashion for internal chemistry reasons.

The aluminum production area in Hubbard includes two premelt furnaces for large primary ingots and one main production furnace. The company indicates a potential phase-two expansion would involve the addition of a second production furnace.

Nicol anticipates that Ellwood’s aluminum castings largely will supply the automotive and aerospace sectors. Ellwood’s previous history has been tied to the production of iron castings, including gray iron castings up to 160 tons in weight and ductile iron castings that can weigh up to 60 tons, according to its website.

Photo courtesy of Nucor Corp.

Nucor’s Q2 steel shipments down from Q1

Nucor Corp., the electric arc furnace steelmaker based in Charlotte, North Carolina, has announced consolidated net earnings of $108.9 million, or 36 cents per diluted share, for the second quarter of 2020. The company reported consolidated net earnings of $20.3 million, or 7 cents per diluted share, for the first quarter of 2020 and $386.5 million, or $1.26 per diluted share, for the second quarter of 2019.

Included in the 2020 first-quarter results were losses on assets of $287.8 million, or 92 cents per diluted share, related to the company’s equity method investment in Italy, Duferdofin Nucor S.r.l.

In the first half of 2020, Nucor reported consolidated net earnings of $129.2 million, or 42 cents per diluted share, compared with consolidated net earnings of $888.3 million, or $2.88 per diluted share, in the first half of 2019.

The company mentions the “considerable economic uncertainty” created by the COVID-19 pandemic, adding, “We believe Nucor is well-positioned to navigate this environment given our diverse product mix, advantaged cost position, flexible production capability and financial strength.”

A total of 5.48 million tons were shipped to outside customers in the second quarter of 2020, a 24 percent decrease from the first quarter of 2020 and a 19 percent decrease from the second quarter of 2019. Total steel mill shipments in the second quarter of 2020 decreased 27 percent as compared with the first quarter of 2020 and decreased 18 percent as compared with the second quarter of 2019.

Steel mill shipments to internal customers represented 21 percent of total steel mill shipments in the second quarter of 2020 compared with 20 percent in the first quarter of 2020 and 19 percent in the second quarter of 2019, the company says. Downstream steel product shipments to outside customers in the second quarter of 2020 decreased 12 percent from the first quarter of 2020 and decreased 7 percent from the second quarter of 2019.

The average scrap and scrap substitute cost per gross ton used in the second quarter of 2020 was $284, a 3 percent decrease compared with $293 in the first quarter of 2020 and a 14 percent decrease compared with $330 in the second quarter of 2019. The average scrap and scrap substitute cost per gross ton used in the first half of 2020 was $289, a 15 percent decrease compared with $341 in the first half of 2019.

Nucor says overall operating rates at its steel mills decreased to 68 percent in the second quarter of 2020 from 89 percent in the first quarter of 2020 and 84 percent in the second quarter of 2019. Operating rates in the first half of 2020 decreased to 79 percent from 85 percent in the first half of 2019.

The company describes demand in the nonresidential construction markets as “resilient” in the second quarter of this year; however, Nucor adds, “The profitability of the steel products segment in the second quarter of 2020 decreased as compared to the first quarter of 2020, but we consider the second quarter of 2020 to be another strong quarter for this segment.”

In its steel mills segment, Nucor says its sheet and plate mills were the most negatively affected of its facilities in light of weak oil and gas market activity and customer production disruptions.