Brazilian steel group Gerdau announced the closure of two plants. The Maracanau plant in the northeastern Brazilian state of Ceará will be closed for a year and a half for modernisation work. The plan is to improve the smelting of 12-metre-long billets, which can be used by another plant in the same state. Until now, Maracanau has been producing semi-finished billets no longer than 6 metres.
In the south-eastern Brazilian state of Minas Gerais, the old Barao de Cocais plant with an annual capacity of 330,000 tonnes will be completely decommissioned. This plant has a small blast furnace that recovers charcoal and iron. The plant consumed large quantities of scrap in the steel smelting process.
Gerdau CEO Rodrigo Werneck said the company was getting rid of old plants with high production costs. In addition, the company has no iron ore assets of its own, which makes blast furnace production unprofitable. At the same time, several of the company's smaller plants will undergo modernisation in the coming years.
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