CMC Building Micro Mill in Arizona

Commercial Metals Co. announced plans to build a "Micro Mill" steel plant in the greater Phoenix area. The company says the new facility will be a continuous design where metal flows uninterrupted from melting to casting to rolling.

The company says it is more compact than existing, larger capacity steel minimills by taking advantage of both lower initial capital construction costs and ongoing operating efficiencies by focusing on cost-effective production of a limited product range.

The mill is expected to cost around $130 million and should start up by early 2009. The mill will focus on manufacturing reinforcing bar. It will have an annual capacity of 280,000 tons.

Russ Rinn, president and CEO of the CMC Steel Group, said, "CMC has worked closely with Danieli to jointly develop an innovative combination of proven technology that will result in a highly efficient, lower capital and operating cost facility. The Micro Mill will market to a localized, underserved rebar area and is intended to vertically integrate with our expanding downstream fabrication operations in the Pacific Southwest.

"The greater Phoenix area continues to grow, has an abundant supply of scrap and a solid construction market which will provide good access to locally generated raw material and nearby end-use markets."

Murray McClean, CMC’s president and CEO, said, "As we continue the execution of our growth objectives, we constantly evaluate the merits of greenfield opportunities versus the purchase of existing capacity. The current market conditions for acquisitions have convinced us that building this first Micro Mill is the most economic method to achieve our objectives."