Arcelor Mittal announces closure of Georgetown wire rod plant

Arcelor Mittal North America has decided to close its Georgetown, South Carolina wire production in the third quarter of this year. The company said “difficult market conditions” were the main reason for the closure. According to the company, high transportation costs, unfair and cheap imports from China and other countries, high scrap metal costs and rising electricity prices have made production unprofitable.

According to information provided to customers, the company indicated that the domestic core industry continues to be heavily influenced by the supply of products from China and other countries. Imports accounted for 36 percent of the US wire rod market over the three-month period from January to March this year.

Earlier, during the economic downturn in 2009, the Arcelor Mittal facility was already idle, but was reopened in early February. The plant suffered huge losses due to reloading amid rising costs and cheap imports. The high cost of scrap metal in the South-East region, even in comparison with the West, also increases the cost. The inability to unload at the port of Georgetown forced the company to transport raw materials by truck, making costs volatile.

The plant closure will lay off nearly 226 workers and will likely benefit Nucor Darlington and Charter Steel. The cutback in wire rod production could also provide good support for the prices of these products. The company said it is working with the Department of Employment and Human Resources to develop a transition plan for laid-off workers. The closure operation is expected to be completed by September 2015.