Severstal exec gives update on Columbus steel operation

October 30, 2013 10:02:01 AM

William Browning - wbrowning@cdispatch.com

 

Severstal Columbus, a steel plant in Lowndes County, sits on roughly 1,400 acres just east of the Golden Triangle Regional Airport. But what do they actually do there? 

 

Madhu Ranade, the plant's vice president and general manager, answered that question while speaking to the Columbus Rotary Club at the Lion Hills Golf Club on Tuesday.  

 

The Columbus operation began in 2007. The parent company is OAO Severstal, a Russian company, and the word "severstal" translates to "steel of the north."  

 

The company's Russian plants, Ranade said, "are based on starting from stuff you take out of the ground," like iron-ore and coal. The local plant, though, is different. 

 

"Severstal Columbus starts with scrap," Ranade said. "One hundred percent recycled steel operation." 

 

The scrap the facility uses comes from industrial sites -- like automotive companies and pipe and tube manufactures -- and from "mom and pop" operations that have scrap yards. Ranade said the scrap comes from as close as Columbus and from as far away as Mexico. 

 

"But everything within a 300- to 400-mile radius, we can get it," he said. "It comes by barge and it comes by rail." 

 

The Columbus facility is capable of melting 3.4 million net tons of steel a year. A good day, Ranade said, is one when 300 trucks loaded with steel exit the plant. 

 

"We make products that you use in everyday life," he said. 

 

The world uses roughly 1.5 billion tons of steel a year. Severstal produces about seven percent of that number. 

 

Breaking down where the steel goes, Ranade said 31 percent goes to pipe and tube manufacturers; 15 percent goes to appliances makers; 14 percent goes to automotive companies; 12 percent goes to construction; and 8 percent goes to heating and air conditioning companies. 

 

"We are growing our market," Ranade said. "We have a good presence in pipe and tube and we are trying to grow our market in appliance and automotive business." 

 

Severstal has two facilities in North America: the one in Columbus and another in Dearborn, Mich., which was actually founded by Henry Ford. The Michigan site is in the middle of the country's automotive manufacturing region and the Columbus facility, Ranade said, "is in the heart of a growing manufacturing area." 

 

"We are in good position to supply those businesses," he said. 

 

Severstal Columbus is on pace to have $2 billion worth of revenue this year and he credited not only technology and investments, but the employees, which earn on average $78,000 a year. 

 

The company, which employees about 650 people, aims at hiring local people, Ranade said. 

 

"We basically want to use local talent," he said. "We want people who are from here and who are going to be staying here." 

 

Ranade said the company wants to develop labs at Mississippi State University and at the University of Alabama aimed at teaching students how to produce and develop steel products.