Still struggling in America: Russia’s largest steelmaker plans to close US plant

Still struggling in America: Russia’s largest steelmaker plans to close US plant

America’s post-crisis reindustrialization and rail projects have provided greener pastures for Evraz, but now Russia’s largest steel producer will suspend operations at a Delaware plant after a sharp fall in metals prices and weak market conditions.

               

The Claymont, Delaware, mill will wind-down operations over the   next two months and nearly all of the plant’s 375 employees will   be laid off. The company is evaluating different scenarios under   which it can reopen the 500,000 ton-capacity plant.

Evraz, America’s number one rail producer, said that it doesn’t   expect a financial loss tied to the closure, and current Claymont   customers will be served by one of the other seven operational   production units in North America, five in Canada, and two in the   US states of Oregon and Colorado, where demand for rail is high.

“Unfortunately, market conditions continue to be challenging   and low market visibility makes it difficult to foresee when   positive changes will occur,” executive Vice President John   Zanieski said in a statement on October 14.

“Fundamentally, [the closure] confirms the problem of the   steel market and shows the damaging effects when Russian   steelmakers expand abroad,” Kirill Chuyko, head of equity   research at BCS, a Moscow-based investment firm, said.

In the first half of 2013, Evraz net income decreased by 21   percent, or nearly $939 million due to the sharp price decline in   coal, metals, and other raw materials, which have hit mining and   steel companies, many of which are Russian. 

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