US steel buyers were keeping a close eye on potential supply disruptions Feb. 16 as winter storms and cold temperatures caused power outages and transportation issues throughout the Central US and Texas.
Multiple service center sources said they were hearing issues among mini-mill producers in assuring reliable energy supply as parts of the country were issuing rolling blackouts amid the record cold temperatures and high demand.
A buy-side source said he was offered steel from a mini-mill supplier dealing with the frigid temperatures, but they had to walk back the offer as natural gas usage was being curtailed.
Several other sources reported production issues at Nucor’s Hickman mill in Arkansas, however this was not confirmed.
“The serious weather conditions many parts of the country are experiencing is have some impact on Nucor facilities, particularly as it pertains to transportation,” Nucor spokeswoman Katherine Miller said Feb. 16. “Individual Nucor divisions are making determinations about operations and shipping products based on weather conditions in their area in order to ensure the safety of our customers, carrier partners and teammates, which is our top priority. We do not anticipate any significant delays.”
US Steel, which acquired the remaining stake of Osceola, Arkansas-based Big River Steel in January, said it is not seeing significant issues caused by the weather to-date at its operations in the area.
“We have not experienced any significant weather-related issues at this time,” US Steel spokeswoman Meghan Cox said. “We are monitoring the situation and preparing as needed.”
A request for comment from Steel Dynamics Inc., which has operations in the region, was not immediately returned Feb. 16.
With cold temperatures persisting and more snow expected in Arkansas, a service center source said he had heard mini-mills were facing pressure to suspend operations to conserve energy.
A second service center source said their operations in Arkansas and Texas were suspended this week due to weather-related issues. He said he expects the worst is still to come amid freezing gas lines and rolling power blackouts with more snow on the way.
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