Company «Arrium» goes into administration
Metallurgical Company «Arrium» Australia is the only producer of long products. Recently, representatives of the company announced the move «Arrium» under external management. This decision was taken after the refusal of creditors to accept a reorganization plan. It was proposed in February 2016 and provided financial transformation. In particular, the proposed capital increase at the level of 927 million. USD. The proposed debt write-off has reached 55%.
Local media estimated the activity of the company. Plants «Arrium» today are able to produce about 2 million. Tons of steel annually. The production capacity of iron ore at 12 million units. Tons / year. All companies are currently working in standard mode. However, experts are confident in the precariousness of the situation. It is very likely that the company will be closed. In this case, there will be a loss of jobs at the level of 7000.
Today, the Australian steel industry is in a protracted crisis. In September last year about a possible halt operations said BlueScope Steel. This company is the largest domestic steel producer. At the same time Worldsteel data in 2015. Australia has increased steel production. The growth was 6.9% compared to 2014. Volumes reached the level of more than 4.9 million. Tons. And the anti-dumping duties in the country for different types of steel are inferior unless the United States. And while most major Australian producers suffer losses.
Analysts have considered the situation and explain it for several reasons. «Arrium» recently invested considerable finances in the modernization. Improvements concerned the only blast furnace plant. Its capacity is 1.2 mln. Tons / year. These costs were made on the basis of the subsequent increase in export volumes. But excessively high cost of raw materials and energy have made rabsilu «Arrium» uncompetitive. In addition, the lack of performance is not given to save the company's scale. The last straw was the fall of the global rental cost. Prices fell on excessive exports from the PRC. In «Arrium» available and profitable unit. «Moly-Cop» produces grinding balls, but the proceeds do not cover the total loss. However, the administration and the creditors to save the company's business plan.