Nucor 2011 Annual Report Download - page 6

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Highlighting a few key investments, construction began on Phase I of an ironmaking facility on 4,000 acres in St. James Parish,
Louisiana, and is proceeding on schedule. We continue to expect start-up in mid-2013. This first phase, with an annual capacity of
2.5 million tons per year, will bring us closer to our long-term objective to control between six and seven million tons of high-quality
scrap substitutes, supplementing the expansion at our ironmaking facility in Trinidad from 1.8 million metric tons to 2.0 million
metric tons.
The new facility will use a proven technology to convert iron ore pellets, utilizing efficient, low-cost natural gas as the reductant,
into high-quality direct reduced iron (DRI). DRI is used by our steel mills, along with recycled scrap, in producing numerous
high-quality steel products such as sheet, plate and special bar quality (SBQ) steel. Fracking, a process that fractures rock to
release natural gas, promises to make natural gas even more plentiful and affordable. While we realize the fracking process has
generated some recent controversy, we are confident that careful extraction practices will provide a valuable, plentiful, low-cost
source of natural gas for generations to come. In fact, it is a major “game changer” for our country and U.S.-based manufacturing.
We commissioned a heat treating facility at our plate mill in Hertford County, North Carolina during 2011. The heat treat line has an
estimated annual capacity of 125,000 tons and has the ability to produce heat treated plate from 3
/
16 of an inch through 2 inches thick.
Our new Kingman, Arizona, wire rod and rebar mill and SBQ mill in Memphis, Tennessee, achieved profitability by the first quarter
of 2011. We also installed a new quality assurance line at our SBQ mill in Norfolk, Nebraska, while our Darlington, South Carolina,
mill implemented new casting practices that enabled it to expand its presence in higher quality SBQ applications. Our SBQ mills
have been and will continue to be a source of growth as we grow our core product range and expand market penetration.
Our joint venture in Italy, Duferdofin Nucor, revamped the finishing rolling mill of its steel beam plant in Pallanzeno, Verbania, in the
northwestern region of Piedmont. The project also included a state-of-the-art rolling mill control system.
DJJ continued its growth by completing four acquisitions since mid-2010. The DJJ team has also continued the development and
refinement of new technologies to extract significantly higher ferrous and non-ferrous metal yields from shredded scrap.
These highlighted projects are just a sample of
the many projects our teams are undertaking
to grow our long-term earnings power in every
part of the company. From 2008 through 2011,
we invested more than $2 billion in projects
to continually improve our existing operations
at every level. Supported by our prudent
investments, our product groups continue to
expand further up the value chain, while retaining leadership positions in our current markets.
While 2011 saw significant new regulations imposed on Nucor, our environmental performance continued to improve. We are
pushing forward with innovative measures to ensure our continued full compliance with both existing and new regulations. In
January 2011, Nucor Louisiana received the first major source permit issued in the United States under the new greenhouse
gas rules imposed by the EPA, demonstrating our ability to permit projects that others view as extremely difficult or impossible.
Our environmental staff continues to find economic opportunities to improve compliance and decrease costs while helping our
operations manage the impact of new regulations on our company.
Working Together
Our improved results in 2011 benefited greatly from our position as North America’s most diversified steelmaker. Product diversification is
a critical building block in the business model that drives Nucor’s industry-leading, through-the-cycle return on capital performance.
Our product diversity is evidenced by the fact that our largest product categories — sheet steel, steel bars, structural steel, steel
plate, scrap and steel products — each represent more than 10% of our total sales tons.
THESE HIGHLIGHTED PROJECTS ARE JUST A SAMPLE OF THE MANY
PROJECTS OUR TEAMS ARE UNDERTAKING TO GROW OUR LONG-TERM
EARNINGS POWER IN EVERY PART OF THE COMPANY. FROM 2008 THROUGH
2011, WE INVESTED MORE THAN $2 BILLION IN PROJECTS TO CONTINUALLY
IMPROVE OUR EXISTING OPERATIONS AT EVERY LEVEL.