California Steel Industries to Build Galvanizing Line at Fontana Mill
Nucor Corporation (NYSE: NUE) announced that California Steel Industries (CSI) will construct a new continuous galvanizing line in Fontana, California, with a projected annual capacity of 400,000 tons. This $370 million investment aims to enhance CSI's total galvanizing capacity to 1.2 million tons annually, catering to construction markets in the western U.S. The project is expected to take 30 months post-regulatory approvals, following Nucor's acquisition of a 51% stake in CSI earlier this year.
- Investment of $370 million to build a galvanizing line.
- Annual capacity increase to 1.2 million tons for CSI.
- Expansion positions CSI to benefit from recent market closures in galvanizing capacity.
- 30-month construction timeline may delay access to additional capacity.
- Dependence on regulatory approvals could introduce uncertainties.
CHARLOTTE, N.C., Dec. 19, 2022 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) announced today that California Steel Industries, Inc. (CSI) will build a continuous galvanizing line at its mill in Fontana, California. The new galvanizing line will serve construction end markets in the western United States and is expected to have an annual capacity of 400,000 tons. With the addition of this new line, CSI will have a total hot dip galvanizing capacity of 1.2 million tons per year. The investment is expected to cost approximately
"With recent closures of galvanizing capacity in the western region, CSI is seizing an opportunity to provide the high-quality value-added products that our customers have requested," said Leon Topalian, Chair, President and Chief Executive Officer of Nucor Corporation. "This investment continues the strong partnership we have cultivated with JFE Steel of growing together in North America."
CSI is a flat-rolled steel converter with the capability to produce more than 2 million tons of finished steel and steel products annually. The company has five product lines including hot rolled, pickled and oiled, cold rolled, galvanized, and ERW pipe. Key end-use markets served by CSI include the construction, service center and energy markets. CSI employs more than 800 full-time and temporary teammates. CSI is the second partnership between Nucor and JFE Steel of Japan, following the formation of Nucor JFE Steel Mexico, which completed construction in 2020 and is in qualification trials with the burgeoning regional automotive market. Nucor acquired a
In addition to its majority ownership of CSI, Nucor currently operates five strategically located sheet mills that utilize thin slab casters to produce flat-rolled steel for automotive, appliance, construction, pipe and tube, and many other industrial and consumer applications. The company also has a sixth wholly owned sheet mill under construction in West Virginia. The capacity of Nucor's sheet mills is currently estimated at 14 million tons per year and, inclusive of this investment and the planned additions in West Virginia and South Carolina, Nucor will grow to 6.4 million tons of galvanizing capacity in the United States. All of Nucor's sheet mills are equipped with galvanizing lines and five of them are equipped with cold rolling mills for the further processing of hot-rolled sheet steel.
About Nucor
Nucor and its affiliates are manufacturers of steel and steel products, with operating facilities in the United States, Canada and Mexico. Products produced include: carbon and alloy steel -- in bars, beams, sheet and plate; hollow structural section tubing; electrical conduit; steel racking; steel piling; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; precision castings; steel fasteners; metal building systems; insulated metal panels; overhead doors; steel grating; and wire and wire mesh. Nucor, through The David J. Joseph Company, also brokers ferrous and nonferrous metals, pig iron and hot briquetted iron / direct reduced iron; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.
Forward-Looking Statements
Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties which we expect will or may occur in the future and may impact our business, financial condition and results of operations. The words "anticipate," "believe," "expect," "intend," "project," "may," "will," "should," "could" and similar expressions are intended to identify those forward-looking statements. These forward-looking statements reflect the Company's best judgment based on current information, and, although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the projected results and expectations discussed in this news release. Factors that might cause the Company's actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) competitive pressure on sales and pricing, including pressure from imports and substitute materials; (2) U.S. and foreign trade policies affecting steel imports or exports; (3) the sensitivity of the results of our operations to prevailing market steel prices and changes in the supply and cost of raw materials, including pig iron, iron ore and scrap steel; (4) the availability and cost of electricity and natural gas, which could negatively affect our cost of steel production or result in a delay or cancellation of existing or future drilling within our natural gas drilling programs; (5) critical equipment failures and business interruptions; (6) market demand for steel products, which, in the case of many of our products, is driven by the level of nonresidential construction activity in the United States; (7) impairment in the recorded value of inventory, equity investments, fixed assets, goodwill or other long-lived assets; (8) uncertainties surrounding the global economy, including excess world capacity for steel production, inflation and interest rate changes; (9) fluctuations in currency conversion rates; (10) significant changes in laws or government regulations affecting environmental compliance, including legislation and regulations that result in greater regulation of greenhouse gas emissions that could increase our energy costs, capital expenditures and operating costs or cause one or more of our permits to be revoked or make it more difficult to obtain permit modifications; (11) the cyclical nature of the steel industry; (12) capital investments and their impact on our performance; (13) our safety performance; and (14) the impact of the COVID-19 pandemic and any variants of the virus. These and other factors are discussed in Nucor's regulatory filings with the Securities and Exchange Commission, including those in "Item 1A. Risk Factors" of Nucor's Annual Report on Form 10-K for the year ended December 31, 2021. The forward-looking statements contained in this news release speak only as of this date, and Nucor does not assume any obligation to update them, except as may be required by applicable law.
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SOURCE Nucor Corporation
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