US steel giant Steel Dynamics, Inc. (SDI) is confident that if its Mexico’s Altos Hornos de México restarts operations, it will keep a portion of its customers, SDI Chairman and CEO Mark Millett told investors this week, according to news reports.
“We are quite confident that the customer base there around AHMSA, certainly in Monclova, has recognized that single sourcing is a huge mistake. And even with an arm of a startup, we are going to continue to secure a lot of that business that we have and market share that we have gained,” Millett said.
AHMSA suspended its production in early 2023. With an annual production capacity of 5.5 million metric tons of steel, the company has as a potential buyer the American investment fund Argentem Creek Partners, which will inject $200 million to restart production until its conditions are met, including the restructuring of the company's debts with organizations related to the Mexican government.
Millett acknowledged that SDI has capitalized on the paralysis of AHMSA. Although it is currently unknown when it could restart operations, Millett said “there is a lot of projections as to how quickly they restart, if they restart.”
SDI COO Barry Schneider confirmed this by reporting “We have been doing quite a bit of shipments into Mexico this year,” primarily from his plant in Sinton, Texas.
Sinton's facilities are located 150 miles east of Nuevo Laredo (Mexico), 174 million miles east of Colombia (Nuevo León, Mexico) and 180 miles north of Reynosa (Tamaulipas, Mexico).