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Hogan Steel Archive: Minimills

The “Hogan Steel Archive,” representing a three-year collaborative effort of the Walsh Library’s Department of Archives and Special Collections and Fordham’s Industrial Economics Research Institute, commemorates and preserves the remarkable steel legacy

Minimills

The Archive’s 51 minimill files contain information on the minimill concept of steel production, its economics in comparison to that of the major mills, technology and plant flows, operating costs, equipment needs and capital costs, DRI-based costs, role in the U.S. steel industry, U.S. plant lists and map, plants in the United Kingdom, financing and financial projections, growth in plant size, feasibility studies, raw-material requirements, original product markets, rod production, role in the flat-rolled steel business, and membership list of the Concrete Reinforcing Steel Institute (CRSI). The files also include documents relating to minimill pioneers Dr. Willy Korf and Nucor’s F. Kenneth Iverson.

Among the Archive’s minimill books and references are the following: Minimills and Integrated Mills: A Comparison of Steelmaking in the United States by Father Hogan; KORF 25 Years: 1955-1980, published by KORF Stahl AG; Economics of the Minimill by Peter Marcus and Karlis Kirsis; and RIVA 1954-1994 by Margherita Balconi. Lists of current and former minimills are contained in a number of references, including the Membership Directory of the Steel Manufacturers Association (SMA), the Directory of the Steel Bar Mills Association (SBMA), and in Metal Bulletin’s Iron and Steel Works of the World.

Analysis: The minimill, a classic example of the way new technology drives competition, emerged in the early 1960’s as a means of exploiting continuous casting, then in the initial stages of its commercial introduction. The first minimills used simple billet-casting machines to link their electric furnaces and flexible rolling mills, which permitted them to enter the steel business on a highly competitive basis for a very limited investment. Their size and approach to production were conducive to simplified corporate and operating structures, much lower overhead costs, and greatly reduced labor inputs relative to their much larger, integrated competitors.

The success of today’s two-million-ton-plus, flat-product minimills makes it easy to forget just how small their early counterparts were and just how little capital they required. In the mid-1960’s, for example, a minimill with 50-60 thousand annual tons of long-product capacity could be built for under $5 million. Just such a plant was built for $4.2 million, land included, by Tennessee Forging Steel Corporation, which in 1966 started up a 60-thousand-ton minimill at Harriman, Tennessee to produce forging-quality billets, rebar, angles, and smooth rounds for sale within a geographic radius of a few hundred miles.

The early success of small minimills in the United States and in Italy, particularly around Brescia, prompted their spread to other parts of Europe, Canada, Japan, the Middle East, Latin America, and Southeast Asia, helping to boost the world’s electric-furnace steel output from 38 million tons in 1960 to 87 million tons in 1970. Then, as continuous-casting technology advanced, so did the role of the minimills. Increasing in number and size, their capability extended to the entire long-products segment, which they came to dominate in most parts of the world.

By 1984, there were 330 minimills worldwide, the top-three minimill countries being Italy with 75, the United States with 50, and Japan with 25. Minimill size, contrary to name and concept, had graduated upward, the capacities of many minimills then exceeding 300 thousand annual tons and directed at producing more diverse and sophisticated products to serve wider geographic markets. As the prospects for added growth in long-product markets began to wane, minimills started to seriously consider the possibility of entering the flat-rolled business.

In 1986, Nucor Corporation was on the verge of installing its first “thin-slab” caster at Crawfordsville , Indiana , having selected new technology developed by Schloemann-Siemag (SMS). Nucor’s breakthrough came with the August 1989 startup of Crawfordville’s new minimill, having an initial capacity to produce 907 thousand annual tons of hot-rolled sheets. Additional minimills in the United States and other countries have since entered the flat-rolled business, and Nucor now operates four thin-slab plants with a combined sheet capacity of about 10 million annual tons, helping to make the company the largest steel producer and scrap recycler in the United States .