Hylsamex Awaits Better Times to Expand Sidor

Mexican steelmaker Hylsamex is continuing with the process of adjusting and optimizing the Sidor plant in Venezuela, in which it has a share, Hylsamex marketing manager Thomas Scarnati told BNamericas.com. "We're trying to improve productivity at the plant, but we have no expansion plans for the moment. Once we've got production up, then depending on the difficult situation in Venezuela, we will look at expanding Sidor," he said. Scarnati continued, "The idea is to optimize operations at Sidor, improving pellet and plate production, as well as to optimize in the short or medium term, the modernization plan for its reduction plants, some of which are 30 years old." Sidor produces pellets and long and flat products using direct reduction. The Amazonia consortium, made up of Hylsamex, Tamsa (also Mexico), Siderar (Argentina), Usiminas (Brazil) and Sivensa (Venezuela) holds 70% of Sidor. Meanwhile, Hylsamex is concluding a US$1bn-plus expansion plan that has been in place 8-10 years and included remodeling all installations. One of the most recent projects was setting up a second hot-sheet production line. "We've achieved a very high degree of modernization and so we don't have big investments planned, at least over the next three or four years, and we're still working on fully satisfying the Mexican market," said Scarnati. On the recent hike in gas prices, he said: "In terms of steel production, we're running at full capacity, but it has affected production of reduced iron, although we have the option to replace it with scrap." The high gas price is also affecting sales of the company's direct reduction technology, he said, especially in the Americas. "Now gas is so expensive we're looking for a policy in Mexico that is more in tune with conditions in the country, so we're not so hurt by external factors," he said.