Rasselstein will not cut tinplate production in 2009

Factiva: "German tinplate producer Rasselstein will not be cutting production in 2009, despite previous warnings that output reductions in this fiscal year were likely (MB July 31), a company spokesman told MB. 'Rasselstein was considering cuts to production last year caused by a shortage of pre-material, due to the strong demand for hot rolled coil worldwide,' the spokesman said. 

'Since the shortage of pre-material is no issue presently, the original plans for full production are being performed now,' he added. Rasselstein, which is a subsidiary of ThyssenKrupp, has a tinplate production capacity of 1.5 million tpy at its Andernach plant, the world's largest packaging steel facility. The company is currently enjoying strong demand for food cans and 'sees no indication that demand for packaging steel will drop in the months ahead', the spokesman said. 'Rasselstein is optimistic so far,' he added."

But a continuing concern for the tinplate maker is the dramatic increase of the cost of hot rolled coil in 2008. Although hot rolled coil on the European domestic spot market has declined from highs of €800-830 per tonne last summer to current levels of €380-450 ($481-570) per tonne, these reductions do not affect Rasselstein. The company purchases its hot rolled coil substrate from parent company ThyssenKrupp and requires specific, high quality material that is not available on the open market, according to the spokesman. Furthermore, Rasselstein is locked into long-term contracts with ThyssenKrupp that were based on the high iron ore and coking coal contracts set last year. Although the market is expecting raw materials contracts to fall this year, Rasselstein would not comment on the likely impact of this on its hot rolled coil contract prices. "There have been no final discussions on the raw materials negotiations and no indications where ore prices will develop," the spokesman commented.