Amid an otherwise dismal week in which steelworkers learned that the sprawling tinplate mill will be idled, RG Steel announced last night that it will reopen an operation at Sparrows Point that makes rust-resistant steel for the building trades.
The company is counting on a rebirth of sales of Galvalume, one of the most successful products ever produced by Sparrows Point, to make its sheet-coating facilities profitable.
Specifically, the company will reopen next month the No. 2 galvanizing line that was shut by Severstal, the previous owner, two years ago. The opening will allow Sparrows Point to use the more modern No. 4 line to run primarily Galvalume.
Well-placed sources told The Brew that the company’s present plan is to run 15 turns a week at the No. 2 line, resulting in about 40 jobs.
While a far cry from the number of jobs that will be lost with the closing of the tinplate mill, the expanded line will mark Sparrows Point’s return to supplying customers with a broad range of galvanized products.
Huge Commercial Success
Galvalume is an aluminum-zinc, alloy-coated sheet developed by Bethlehem Steel and first produced at Sparrows Point in 1972. The product became a huge commercial success because of its superior corrosion resistance.
Used for roofing, windows and doors, the material can be roll-formed into a variety of panels and stamped into shingle facsimiles as well as painted for extra durability.
Bethlehem Steel licensed the product and sold its patents and technology to steel companies around the world.
The deep recession of the building trades led Severstal to close the No. 2 line in July 2010, limiting production to the No. 4 line.
Using the cash recently supplied by Cerberus Capital Management, RG Steel decided to reopen the No. 2 line.
Because the line was not placed in “asset protection mode,” RG Steel has been forced to spend more than $2 million to repair the motors and overhead cranes to make the facility serviceable, well-informed sources told The Brew.