FORT WAYNE, INDIANA, November 27, 2012/Steel Dynamics, Inc.
(NASDAQ/GS: STLD) today announced plans to install a state-of-the-art
heat-treating system at its Columbia City, Indiana, Structural and Rail
Division (SRD). When operational, the system will be capable of
producing up to 350,000 tons of standard strength and head hardened
plain, carbon steel rails for North America’s railroad industry.
Capital investments are estimated to be slightly less than $27
million. Site preparation will commence immediately with construction
expected to begin in the first quarter of 2013. The company anticipates
it will commission the system before the end of 2013. Production
ramp-up is expected to continue through 2015, reaching full production
of 350,000 tons in early 2016. This expansion is expected to create
nearly forty (40) new, full time jobs. The company plans to
locally-source much of the equipment, with a majority of the required
materials carrying the Made in USA manufacturing marking
It is anticipated that the new rail capabilities will permit the
Structural and Rail Division to become North America’s pre-eminent rail
manufacturer for rail quality, end straightness, and dimensional control.
Unlike the company’s domestic competitors, which produce 80 foot rail
on less efficient, older technology, the company’s new process will
involve a modern universal mill capable of rolling high quality 320-foot
long rails. These longer rails will be cut to customer-required
lengths or welded together into quarter-mile long strings utilizing only
four, instead of nineteen, welds, using the company’s existing
state-of-the-art Continuous Rail Welding facility. By reducing the
number of welds, this technologically advanced system will significantly
reduce the potential for weld-related track issues, dramatically reduce
associated production costs, and provide customers with the quality
rail needed for 21st Century rail systems.
“We are excited to announce this important growth initiative,” said
Mark D. Millett, Steel Dynamics’ Chief Executive Officer. “This
investment will allow us to further expand and diversify our Structural
and Rail Division’s market in a capital efficient manner. During 2012,
we shipped our rail products to many of the American and Canadian Class 1
railroads, as well as to Mexico’s largest railroad. Our rail customers
have encouraged us to expand our product offerings to not only include
head-hardened rail, but in these longer rail strings, thereby enabling
our customers to reduce their cost of rail maintenance and replacement.
This project will provide that need. Adding this product further
demonstrates our entrepreneurial and innovative response to a
marketplace demand, providing our customers with high quality,
cost-effective products they want and need. Moreover, customers will be
able to make us their “one-stop-shop” for all cut or welded rail
products.
“Since 2002, when we began production at our Structural and Rail
Division, our team has partnered with a variety of customers, supplying
them with consistently high-quality products. We have achieved a
reputation for on-time performance, scheduling flexibility, and
consistently high quality. With this new investment, we expect to be
able to build on that reputation. We will of course continue to offer
our traditional, high quality products to our existing structural beam
and piling customers, and we look forward to expanding our relationships with our new rail customers,” Mr. Millett concluded.
About Steel Dynamics, Inc.
Forward-Looking Statement
Contact: Marlene Owen, Director Investor Relations—+1.260.969.3500 |