Consolidation of production to Grupo Simec's state-of-the-art Tlaxcala, Mexico mill enables more competitive
pricing, increased environmental responsibility, and enhanced
product quality.
GUADALAJARA, Mexico, Aug. 10,
2023 /PRNewswire/ -- Grupo
Simec (AMEX:SIM), a leading international
producer of special bar quality (SBQ) steel, steel wire, rebar, and
commercial and structural steel long products, today announces it
will indefinitely idle steelmaking operations at its Republic Steel
mills in Canton, Ohio, and
Lackawanna, N.Y.
During the idling, Republic Steel's U.S. customers will be
served via Grupo Simec's
state-of-the-art steel mill in Tlaxcala,
Mexico. U.S. customers will experience no interruption in
service. As a result of the consolidation, about 500 Republic Steel
employees will be furloughed indefinitely.
According to Jaime Vigil,
Republic Steel board member and executive advisor, Grupo Simec exhausted every additional potential
option besides idling these two operations.
"We're facing an extremely challenging SBQ market in the U.S.,
with competitive market pricing and decreased demand," said Vigil.
"At the same time, we've had to deal with increasing input costs on
all raw materials, consumables, and labor, all as a result of the
inflationary environment in the U.S. over the past year."
Vigil said there was hope that inflationary pressures would
ease, and that Republic Steel would experience a bump in business
following the passages of the Infrastructure Bill in 2021 and the
Inflation Reduction Act in 2022. Unfortunately, neither came to
fruition in a timely manner.
Grupo Simec and Republic Steel
are the only producers of leaded steel in North America and have been committed to doing
so in an environmentally responsible manner. In the United States, for instance, the company
took many steps over the past several years to remain compliant
with all environmental regulations, particularly the National
Ambient Air Quality Standard for leaded steel production. During
that time, the company invested approximately $10 million in its Canton facility to maintain compliance with
existing regulations and to respond to the ever-changing
obligations imposed upon it by local, state, and federal
environmental regulators.
Although Republic Steel has, for the past two years, remained in
strict compliance with the National Ambient Air Quality Standards
for the production of leaded steel, ensuring future environmental
compliance while producing steel in facilities that are up to 125
years old proved to be too challenging. As a result, Grupo Simec felt it would be most
environmentally responsible to do so at its new, state-of-the-art
mill in Tlaxcala.
"One of our core values at both Grupo
Simec and Republic Steel is to always be environmentally
responsible," said Vigil. "As the only producers of leaded
steel in North America, we also
owe it to our customers, and their customers, to be a reliable
supplier of such products."
"This isn't an easy decision," said Vigil. "But we feel it's the
only way for us to continue to serve our U.S. customer base with an
ongoing and reliable supply of product, including leaded steel, and
to do so at a competitive price point. Ultimately, we're
responsible to our shareholders and our customers. We're simply
doing what needs to be done to meet our responsibilities."
Vigil recognized Republic Steel employees for their tremendous
efforts.
"Republic Steel employees are hard-working and dedicated," Vigil
said. "Their roots date back to the late 1800s. They're an
important reason this company has been a leader in this industry
for so long. And we thank them for their important
contributions."
Republic Steel was acquired by Grupo
Simec in 2005. Simec is one of the largest producers of SBQ
in North America and a top
producer of commercial and structural steel long products in
Mexico.
Headquartered in Canton, Ohio,
Republic Steel is a leading supplier of special bar quality (SBQ)
steel, a highly engineered product. Republic's products include hot
rolled steel bars, cold finished steel bars, cold heading quality
rod and wire, and leaded steel bars. Grupo
Simec, based in Guadalajara,
Mexico, is a leading international producer of special bar
quality (SBQ) steel, steel wire, rebar, and commercial and
structural steel long products.
For additional information, contact:
Ross Seibert
330-438-5470
RSeibert@RepublicSteel.com
View original
content:https://www.prnewswire.com/news-releases/grupo-simec-to-idle-steelmaking-operations-indefinitely-at-its-republic-steel-mills-in-canton-ohio-and-lackawanna-ny-301898387.html
SOURCE Grupo Simec, S.A.B. de
C.V.
