Chilean iron and steel company Gerdau Aza, a unit of Brazilian long steelmaker Gerdau, has budgeted $20 million in upgrades to its scrap recycling plants in 2005, company CEO Hermann von Mühlenbrock told BNamericas.
"The steel world is very competitive so the company has to be absolutely up-to-date to compete," said von Mühlenbrock.
Next year around $15 million of investment is programmed, and in 2007 the company will begin investment in an expansion to almost double plant production, he said.
"From 2007 we should start an important investment of about $100 million to expand the plant to 750,000 tons by 2010," he said, adding that the "bicentenary project" was still in early engineering phase.
The company forecasts production of roughly 400,000 tons in 2005 and 2006, but expects to exceed this figure in 2007. Last year Gerdau Aza produced 371,000 tons.
"We are basically following the local market. This year the domestic market is relatively flat but we think it will be a little more demanding in 2007."
Around 90 percent of Gerdau Aza's production includes bars and rolled steel shapes, which go to the domestic civil construction and metal-mechanics industries. The company also exports to Ecuador.
The company processes almost 500,000 tons per year of scrap. The company covers almost 70 percent of demand for scrap metal provided through a network of scrap collectors of 150,000 people, said von Mühlenbrock.
The company has two production plants, Renca and Colina, in the industrial areas of Chile's capital Santiago and provides 430 direct jobs. BN Americas