Russia’s Magnitogorsk Iron and Steel Works (MMK) has dropped its plans to build a steel plant in the United States amid doubts about USA political will and over the recovery of the USA demand for steel. MMK had announced plans in September of 2007 to build a steel plant in the state of Ohio, with an annual capacity of 1.5 million metric tons. It seems that as soon as the plans were announced the bottom fell out from the world financially. This caused a pause in future plans…
The money was there to invest but the demand of a failing economy and political suicide in America has progressed farther to the point that MMK will no longer wait. They will invest in other aspects of steel elsewhere in the world. MMK made a decision after studying the other two Russian steel companies Severstal and Evraz struggle with surviving in the conditions prevalent in the USA…
That conditions go beyond just lack of steel usage in America, it centers around the fact that American steel has created its own death bed, so to speak…
The steel usage by Asian countries has risen exponentially due to huge infrastructure business. There seems to not be enough steel to go around on this side of the world and with a European Union in a cost cutting phase the future of American steel is shaky at best…
I have been reading about the future of steel in America and the Western Big News is expressing that steel is making a comeback. Of course this is in direct contrast to what the Asian and Russian news is expressing. In fact, China really is trying to get more American steel to use in China. So Russia has watched China test the waters in America here in the last few weeks. China has expressed interest to invest in America with their Ansteel. In fact an American company has signed an agreement with the Chinese and that therein leads to what came next…
Let the political games begin:
The US lawmakers told Geithner they were “deeply concerned” that Ansteel’s “direct investment in an American steel company threatens American jobs and our national security“.
“We believe that this investment allows the full force and financing of the Chinese government to exploit the American steel market from American soil,” they wrote.
China has asked America to kindly not make a political issue out of this but that was to no avail. This is the same bull that Russia constantly receives…
That is an important part of what makes or breaks future investments in America…
Windows to Russia!
- Russia’s Severstal to idle operations at US plant (reuters.com)
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- UPDATE 2-Steel Dynamics Q2 profit lags view, shares down (reuters.com)
- US Steel sees industry comeback, costs crimp growth (reuters.com)
- Canada’s New Steel Industry Key to Industrial Future: New Study (newswire.ca)
- China’s Ansteel assessing US protest over plant deal: report (alternet.org)
- Don’t block Angang’s steel deal, China tells U.S. (reuters.com)
- Angang sees no setback from US steel firms’ objections (reuters.com)