Construction advances on $700M project

North Star BlueScope Steel adding 100 jobs and capacity at Delta mill

North Star BlueScope Steel – an Australia-based steel maker that recycles scrap and turns raw materials like virgin iron into hot rolled bands for end use in various industries including automotive, construction, agriculture, and general manufacturing – is investing $700 million in its Delta, Ohio steel mill to expand the facility and increase capacity.

According to Joe Budion, vice president project finance, North Star BlueScope Steel, the two-year project is currently on schedule, with steel erection of the new 350,000 square foot addition underway. Jacobs Engineering Group is the lead engineering firm for the project, and Rudolph Libbe is the construction manager.

“We’re on schedule,” said Budion. “The weather has been very helpful since it’s been a mild winter, so they’ve really been able to work on it each day. You can see the structural steel going up, the earthworks movement, and it’s been favorable for the foundations and the footings for the concrete.”

According to Budion, the company currently manufactures 2.3 million tons of hot rolled bands and is increasing its capacity to produce an additional 950,000 net tons or a 41% expansion of production capabilities. To do this, the company will be adding a third electric arc furnace, a second slab caster, and a tunnel furnace with a shuttle in its new addition.

“Over the years, we have gone from manufacturing 1.6 million tons of hot rolled bands up to 2.3 million tons, mostly through incremental changes in the operation and efficiency. The owners like the United States market, as it’s a huge market not only for automotive, but for pipe/tubers and for OEMs and agriculture. The owners determined after careful study that they wanted to make more tons here of hot rolled bands, and our customers – generally within a 250-mile radius of here – wanted and continued to ask us for more tons. We listened to them and did the financial analysis and the payback based on IRR and NPV was attractive. There will be more industries and customers that are going to come into this geographic area as a result of us and the expansion,” explained Budion.

“This rolling mill has always been underutilized. This mill was built in the 1990s for expansion to go to three million-plus tons. And we are now in that position where we’re taking the front end, which is where we melt / cast, and increasing capacity. Our best option is to utilize this mill more efficiently and to add some more melting and casting capacity to drive the mill,” said Budion.

With the expansion, North Star expects to melt raw materials by June 2021 and to roll finished product by the fall of 2021. The company is planning to add around 100 jobs as a result of the project.

According to Sheri Caldwell, vice president, human resources, North Star BlueScope Steel, the company currently has 434 employees and has a low-level of turnover. The company offers a range of benefits for its employees in order to both attract and retain the valuable employee base.

Construction in progress at North Star BlueScope Steel’s mill in Delta, Ohio

“People really like to work here. We have single digit turnover, which is a credit to the company, our amazing benefits, culture, and highly-engaged employees. We have employees who travel from neighboring states to work here along with Ohio domiciled employees. We are in a rural area and the challenge is to encourage potential employees to travel to our site in order to see first-hand the best in class plant. Like I said, once they’re here, they realize it’s an easy commute, they like the company, and they want to stay. Candidates participate in a very rigorous hiring process which allows us to attract and retain top notch talent with the appropriate skill set. The process entails everything from group/team assessment to personal interviews,” explained Caldwell.

“Based on our history, about half of the applicants will pass the assessment. Of those who make it to the next step, about half of those people will proceed from the teamwork exercise to the interview. Then, only about half of those remaining will get an offer. That’s why I think our turnover is so low because we take our time upfront screening applicants and ultimately, we’re hiring the right fit for the job. For an operations-oriented role, we do well with recruiting and filling those spots. For any of our trade related jobs – mechanical and electrical maintenance – those remain challenging given current low unemployment levels. We are really looking diligently for those skilled labor people. We have a website, www.northstar.jobs, that we use to provide information to job candidates,” concluded Caldwell.

Budion also explained the “BlueScope Bond” and the core values at North Star.

“We and our customers/suppliers proudly bring inspiration, strength, and color to communities with BlueScope through our partners, our people, our communities and our foundations”. “We are top notch in the area of safety as far as when you go by OSHA recordables and lost time injuries as benchmarked with other steel companies. Safety’s the number one priority. Sustainability is another critical priority for us and all our stakeholders. We consume over two million tons of recycled scrap per year, maintain a wetland onsite, and reduce electricity and water consumption on a per ton basis as part of our continuing efforts toward making sustainable steel. Lastly, we strive to make a high quality product, delivered on time with strong attention to service, to ensure “reliability at every point.”

“We are just highly efficient, run at 100% capacity, are a low-cost producer, and make quality tons. The key differentiator for the location is on time delivery because if you provide on time delivery, that means your customer doesn’t have to tie up as much working capital. Even during down turns in the market, we keep our employees on the payroll. Human capital is one key in delivering on our Blue Scope Bond.

Budion attributed the location of the mill in northwest Ohio as a driving factor behind its success. He explained that in the 90s when a location was being sought for a new facility, the company had about 50 different locations it was considering, but northwest Ohio had the “must-haves” for the company.

“It’s a gem here in northwest Ohio relative to the economy, the schools, the parks, the medical care – it’s really a jewel. The logistics, roads, the Turnpike – it is all very well developed and coordinated. You’d be surprised, at least in my experience in the 90s, because we looked at Illinois, Indiana, Michigan, Pennsylvania, and Ohio,” said Budion. “But the ability to go in and have one point of contact at the Regional Growth Partnership and then they help you springboard into the sales tax exemptions, real property tax abatements, the Port of Toledo dock, the Rail Commission, grants from JobsOhio, access to legislators at the House and the Senate level, that’s a real gift. In another state, you would have to go hunting around and try to figure it all out. They’ve done a nice job here in northwest Ohio with the RGP working with JobsOhio.