ArcelorMittal has decided to reopen a Tennessee steel finishing plant it had closed three years ago because demand had dropped so much.
The world's largest steelmaker, which has an extensive presence in Northwest Indiana, plans to hire 61 new employees over the next two years at ArcelorMittal Harriman, which was mothballed in 2011 because of poor market conditions.
"This is an exciting development for the ArcelorMittal family and the Harriman region, serving as another indication of the strength and resilience of American manufacturing and the United States steel industry," said PS Venkataramanan, CEO of ArcelorMittal Long Carbon North America. "We look forward to working with the United Steelworkers to safely restart the facility and to providing an enhanced product offering to our customers."
The plant gets billets from ArcelorMittal LaPlace, formerly Bayou Steel of Louisiana. The metal is reheated and rolled into merchant bars and other products for the construction market.
"It's a small facility," said Charles Bradford, a New York City-based analyst of the steel industry. "But it's a good sign because it could reflect a recovery in nonresidential construction products, which is the part of the steel market that has been missing. Forty percent of the market is nonresidential construction, but it hasn't recovered at all."
Typically, nonresidential construction does not pick up until late in an economic cycle, after a rebound in the housing market, Bradford said. New home construction came back two years ago, and school, highway, and shopping center projects should eventually follow.
"It's a good sign if it's not based on wishful thinking," Bradford said. "Based on the normal cycles, it should come back, but construction doesn't take place in this snowy and icy weather. In the March and April time period is when you'll know if nonresidential construction is coming back."