U.S. Steel to increase output in Serbia
By Radoslav Tomek
Bloomberg News
Tuesday, June 22, 2004
The steelmaker bought Sardid Co., a Serbian steel mill, in September for $23 million. It pledged to invest $150 million over five years to boost output, with a fifth of the amount allotted for this year, said Christopher Navetta, the president of U.S. Steel's Slovak unit. The Serbian unit produced about 146,000 tons of steel in 2003.
U.S. Steel wants to get more production from the Serbian plant, which was only one-third operational last year, to meet the rising demand for steel in Europe. Sardid could produce as much as 2.4 million tons a year after the investment, U.S. Steel has said.
"We have been able to ramp up production pretty well,'' Navetta, who also is
responsible for Serbian operations, said at a business conference.
Profit at U.S. Steel's European operations, which include a plant in Kosice, Slovakia, rose 85 percent to $203 million. Higher prices, favorable currency exchanges and increases in shipments attributable to the Sartid acquisition boosted profit, the company said in the filing.
European Union export prices for benchmark hot-rolled steel have gained 87 percent this year, with one metric ton now selling for $570, according to Metal Bulletin.
Navetta also said the company doesn't expect the Ukrainian government to change its decision to sell a stake in VAT Kryvorizhstal, the country's largest steelmaker, to a local company. U.S. Steel and LNM Group, which bid in a consortium, have asked the government to review the sale, saying their offer was higher than the winning bid.
"I think it's probably a done deal,'' he said. "I don't see much of a change coming.''
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