Employee safety is the priority in the Hurricane Harvey-devastated Houston area, but steel service centers and producers are being hamstrung by a lack of access to facilities, and restricted mobility in the area is the major challenge.
"Our two operations in Houston are shut down, we just can't get in," Matt Crocker, CEO of Manhattan, Kansas-based SPS Companies, parent to Steel and Pipe Supply told S&P Global Platts Wednesday.
Two SPS operations there -- a steel coil processing operation at Port Houston and a distribution facility just outside of the port -- employ 75 people.
"At best, it will be Friday before they re-open for normal business," Crocker said. "Material is likely to be backed up for at least two or three weeks before normal flows resume," he added. Another SPS service center, further north of the port at Longview, Texas, was operating.
Crocker said after the water recedes and the streets open up, SPS hopes to gain access to its operations.
CONTINUING TO PAY ALL WORKERS
Meanwhile, Crocker said SPS Companies is paying all employees "for as long as the operations are closed due to the storm." All 75 SPS workers are safe, although about 10 employee homes have been affected by the flooding -- some more severely damaged than others.
As of Wednesday afternoon, everything remained at a standstill. There is no steel inbound for at least another 48 hours, and Crocker had heard of only one vessel carrying steel being diverted -- to Mobile, Alabama. As for impact on the market: "Nobody in the affected region needs steel at this time. The safety of our employees is first and foremost," he said.
"We have not received direct communication from members that I am aware, although anyone in the Houston area is obviously impacted," a spokeswoman for the Illinois-based Metals Service Center Institute told Platts via email.
Other sources indicated that with Houston imposing a curfew, this will prohibit the running of a third shift at many operations -- if it is still in effect when employees can return to work.
The country's largest steelmaker, Nucor, has several facilities in the region, including a plate mill in Longview it bought last year from Joy Global. "At this time, our focus is on the safety and well-being of our teammates," Nucor told Platts in response to an email.
"All of them have been accounted for and are safe. With the storm still in progress in southeastern Texas and western Louisiana, we have not been able to fully assess the impact to our facilities," it added.
So far, Nucor is not aware of any material losses. "When conditions improve, we will do a more complete assessment of the status of our facilities and the impact on our operations," a spokeswoman said in the email. "Our thoughts and prayers are with the local residents, especially Nucor families and customers, and the many volunteers and rescue workers coming to their aid."
