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US silicomanganese producer Felman Production aims to restart a second furnace in August at its silicomanganese plant along the Ohio River in New Haven, West Virginia, after operating with only one furnace since February, a United Steelworkers union official said on June 26.
"Things are slow at Felman right now," Roy Martin, the union official, said via email. "They only have one furnace running, but they hope to start their bigger furnace, No. 2, August 1."
He said the company has installed an induction furnace at the plant, but it was "not up and running yet." He added that the market for silicomanganese was "still up and down, but still low."
A Felman spokesman declined to comment on June 26.
When the company announced the idling of one furnace in February, it said the shutdown would "allow Felman to improve production efficiency and environmental compliance."
Felman, owned by Miami-based Georgian American Alloys, restarted the plant last summer, after it was idled from June 2013 to July 2014 because of low silicomanganese prices and high electricity costs. During the shutdown Felman was able to secure power rate relief at the plant, which it said was necessary to restart production last July.
Under the special power arrangement, approved by the West Virginia Public Service Commission last year, Felman receives a discount of up to $9 million annually on its electricity costs from Appalachian Power, the plant's longtime supplier.
Felman has said the discount would enable New Haven to be more competitive with other silicomanganese producers globally. Felman says its products are sold to steelmakers across North America and South America through a sister company, Felman Trading.
The company's New Haven facility is one of two silicomanganese producers in the US. The other is a plant in Marietta, Ohio, operated by Eramet Marietta, a subsidiary of French-owned Eramet. Felman is owned by Miami, Florida-based Georgian American Alloys.
The US silicomanganese market has been very illiquid this year, and spot prices have been under pressure, with the majority of steel mills' requirements being covered on long-term, formula-priced contracts, according to market sources.
At the same time, demand for raw materials by the steel mills has been down this year, compared with last. And the US steel industry's capacity utilization has also been down this year, resulting in many mills only taking minimum requirements under their long-term contracts for ferroalloys and there being no spot demand.
Earlier this week, another Georgian American Alloys subsidiary, US high-purity ferrosilicon producer CC Metals and Alloys, announced it would be idling production at its Calverts City, Kentucky, plant for three months from July 1.
In a statement on June 23, CCMA said the halt in production will allow it to "reduce inventories that have accumulated as a result of weakened market demand and the increased levels of imports that have prevailed during the first half of the year."
It added that around 65% of its 109-strong workforce would be affected by layoffs related to the idling.
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- [Editor:Sophie]
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