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Home > News  > Sidenor performs a new investment amounting to 84 million euros

Sidenor has approved a new investment of 84 million euros intended for the technological renovation of its facilities. The company will thus improve its competitiveness and efficiency a globalized market, which is increasingly demanding in terms of prices, quality and delivery deadlines.

It is the second investment phase in Basauri’s rolling mill, which complements the one performed in 2017, amounting to 41 million euros. The then installed heating furnace will be extended and the renovation of the rolling mill will be totally completed, with an increased production capacity and the ability to manufacture an extended range of products and meet the market’s highest quality requirements.

In addition, this budget of 84 million euros will include the installation of new cranes and the extension of the billet area surface, a new bar straightening and packaging line, new heat treatment furnaces and a new metallurgical laboratory in Basauri. Sidenor intends to finalize the investments, which have already started, by the end of 2020.

Results and new scenario

Such investments were possible thanks to the good results obtained in the last three years, in which Sidenor met the most demanding customer requirements, while facing the pressure induced by costs, in particular energy costs. We are now in a new scenario in which all indicators point to a turn in the world economy cycle, with a specific impact on the steel sector; the automotive industry, Sidenor’s main market, is undergoing a war of prices and experimenting significant drops in production.

Such paralysis in the automotive industry and, generally, the global instability – the trade war between the United States of America and China, Brexit and the expected recession in Germany – are slowing down the economy in the euro zone and affecting the steel sector as well.

Reorganization of assets and growth strategy

On the other side, Sidenor has completed the sale of 75% of the Forgings & Castings company to the German-American consortium NFL. Sidenor will remain a temporary partner, committing to the yearly purchase of 30,000 tons of ingot over the next 6 years.

Sidenor is facing the cyclical upturn with experience, solvency and ability, as well as new initiatives, such as the development and growth of the special steel activity in new markets or the launch of a diversification process, extending its activity to other areas.