NLMK: Slab demand can't be met


Bob Miller, president of NLMK Pennsylvania, outside its Farrell mill.

FARRELL – As president of NLMK Pennsylvania, Bob Miller has been toiling to get a waiver on the 25 percent tariffs slapped on steel slabs the company imports. This is literally do or die for the company.

“We’re fighting for our existence,’’ he said.    

NLMK employs about 600 at its Farrell steel plant and another 150 or so at its Sharon Coating operations in Sharon. Slabs imported by the steelmaker are rolled at the Farrell plant to produce steel coils, which are sold to a variety of businesses, such as automakers and appliance manufacturers.

Miller points to rising steel prices to show the industry is producing near capacity. Steel prices listed on the CRU Hot-Roll Index, a benchmark for the steel industry, were $895 a ton on Tuesday. In June 2015, the price was at $456 – a year-to-year increase of more than 96 percent.

“We’re at a 10-year high for steel prices,’’ Miller said. “And that means there’s lots of demand out there. And there’s lots of objections out there for waivers that are anti-competitive.’’

NLMK’s waiver application is facing opposition from leading American steel producers – Nucor Steel, U.S. Steel and AK Steel. All three have filed objections to NLMK’s application with the U.S. Commerce Department. In their filings, the U.S. steelmakers said there’s ample slab supply in the U.S., but that NLMK is relying on importing slabs to boost profits.

Miller disagrees. 

“Nucor doesn’t make slabs,’’ he said. “AK Steel never sells slabs and U.S. Steel doesn’t have the excess for sale.’’

But that is not how Lisa H. Jester, an AK Steel spokeswoman, sees it.

“AK Steel sent our objection to the Department of Commerce about NLMK’s product exclusion request, and we indicated that AK Steel has both the capacity and capability to supply those slabs from our U.S. operations made by American workers,” she said. “Depending on our product mix, that type of steel could be made at our operations including Dearborn, Mich., Middletown, Ohio or Butler, Pa.’’

A representative from U.S. Steel declined to comment. Repeated messages for Nucor were not returned. 

NLMK isn’t the only company that is seeking relief from the tariffs.

Pittsburgh-based Allegheny Technologies is asking that stainless steel slabs it plans to import from Indonesia not be subject to the 25 percent tariffs. The specialty metals producer and its Chinese partner want to process slabs at Allegheny Technologies Pennsylvania plants in Brackenridge and Midland, Pa., that will create up to 100 jobs, the steelmaker said.

All the area’s state and federal representatives have supported NLMK waivers.

A measure introduced in Congress to clip the ability of a sitting president to slap tariffs on imports has been introduced. U.S. Sen. Pat Toomey, R-Pa., supports the proposed law as does his Democratic colleague U.S. Sen. Bob Casey.

U.S. Rep. Mike Kelly, R-3rd District, Butler, didn’t return phone messages. However, Kelly previously told The Herald that he has met with President Donald Trump and officials from the U.S. Department of Commerce to seek relief for NLMK. Kelly also called for the waiver process to be expedited.

Ron DiNicola, Kelly’s Democratic opponent in the November election, said NLMK has his support for removing the tariffs.

“As I understand it, they can’t get a specialty item for their plant. And under those circumstances they qualify for relief,’’ DiNicola said. “As I’ve traveled through the district, I have not seen precisely the same situation. This is a special circumstance.’’

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