The Brazilian steel giant Gerdau detailed the projects where it will allocate its capital expenditure (CapEx) for more than $1.0 billion in the coming years, which do not include the potential construction of a plant for special steels in Mexico of 600,000 metric tons (mt) annually to serve the automotive market.
At the recent Gerdau Investor Day 2024, the companies Metalúrgica Gerdau, holding company of the steel company Gerdau, reported that the approved strategic CapEx is for the equivalent of $1.68 billion, of which $621 million have already been invested and $1.06 billion is the “revised projection for the coming years” (until 2027).
Of the total investment (executed and pending), 74.5 percent is for Brazil, 21.2 percent for North America and 4.3 percent for special steels.
For North America, the Texas unit Gerdau Midlothian Steel Mill will receive an investment equivalent to $274 million to increase production by 250,000 metric tons (mt). Of that investment, two-thirds are in the process of being executed. In addition, just over $80 million (450 million BRL) for solar downstream in Texas.
In special steels, it will invest 400 million BRL ($73 million, at today's exchange rate) for new scrap processes.
In Brazil, the most important projects due to the required investment include the expansion of the production capacity of its Miguel Burnier mining complex to 5.52 million mt of iron ore per year.
To increase iron ore production from 1.2 to 5.52 million mt, the investment exceeds 3.2 billion BRL ($585 million). Of the investment, around 50 percent has been spent.
Another highly relevant project in Brazil is the expansion of rolling mills by 500,000 mt with an investment of 1.75 billion BRL ($320 million). In addition, for biomass, the company will invest the equivalent of $64 million in forestry.
These are the projects and do not include the potential construction of a 600,000 mt special steel plant in Mexico. In May of this year, the Brazilian steelmaker announced that it was beginning the feasibility analysis.