Steel Mills

AHMSA Furnace Restarted After February Unplanned Outage

March 5, 2021

Altos Hornos de México (AMSA) has resumed normal operations at its No. 5 blast furnace following a temporary outage last month, a company spokesman said. The No. 5 furnace had to stop for two days because of severe weather and a natural gas shortage.

The Mexican flat-rolled steelmaker last month said that it had lost at least 20,000 tons of liquid steel production following an unprecedented cold snap across the southern U.S. and Texas.

The Lone Star state is a significant source of natural gas and electricity for Mexico.

The restart of the No. 5 furnace is another indication that Mexican output has largely returned to normal following February’s severe cold.

Another example: Ternium México declared “force majeure” on Feb. 15 because of severe weather and power outages. The company said during an earnings call later in the month that the event had cost it approximately 80,000 tons of production, but that operations had since returned to normal.

The snow and cold also significantly reduced operations at electric-arc furnace (EAF) steel mills in the southern U.S.

AHMSA operates two blast furnaces, the No. 5 and No. 6, in the northern city of Monclova in Mexico’s Coahuila state.

AHMSA’s No. 6 blast furnace remains idled, the spokesman said.

The No. 6 furnace was not impacted by the cold weather. It was idled in 2020 because of market conditions.

The No. 5 furnace has capacity of 1.91 million tons per year and the No. 6 furnace annual capacity of 1.27 million tons, according to the Association for Iron and Steel Technology’s 2021 Directory of Iron and Steel Plants.

AHMSA makes hot-rolled coil, cold-rolled coil, plate, tinplate and structural shapes, per its website.

SMU does not publish Mexican steel prices. But the North American market, as gauged by SMU’s benchmark U.S. hot-rolled coil index, is testing historic highs.

SMU’s average hot-rolled coil price stands at $1,240 per ton, up 7.8% from $1,150 per ton a month ago and up 25.9% from $985 per ton at the beginning of the year.

Mexico is also an important supplier to the U.S. market.

Domestic steel consumers imported 3.01 million metric tonnes from Mexico in 2020, making Mexico the No. 3 source for foreign steel in the U.S. behind only Canada (4.76 million tonnes) and Brazil (3.67 million tonnes), Commerce Department figures show.

By Michael Cowden, Michael@SteelMarketUpdate.com

Michael Cowden

Michael Cowden is managing editor for Steel Market Update. Cowden has covered the steel industry since 2007. He specializes in flat-rolled steel but has also reported on steel long products, steel pipe and tube, and aluminum. Before joining SMU, Cowden held reporting jobs at Fastmarkets AMM in Chicago, the Associated Press in Pittsburgh, and the Cambodia Daily in Phnom Penh. He has also worked as a copy editor and in marketing at the University of Chicago Press. Cowden has a BA in English from the University of Chicago and an MSJ journalism from Northwestern University’s Medill School of Journalism. Contact him at michael@steelmarketupdate.com or 724-759-7872.