BNamericas quoted Mr Santiago León production, labor and competitiveness minister as saying that Ecuadorian government is carrying out preliminary design studies for a steelmaking plant.

The minister said that the plant is targeted for startup in 2016 and preliminary estimates put investment at USD 800 million to USD 1 billion.

The steel plant would supply state infrastructure works, such as the eight hydroelectric plants in the pipeline, and reduce the import of steel products.

Mr León said that "Producers will be benefited by this strong demand from the construction of eight hydroelectric plants started in 2011. We can imagine all the demand for raw material behind that construction, but for producers to have that raw material and be more competitive, we need that basic steel industry."

Currently there are three steel companies operating in Ecuador: Andec; Adelca, with capacity of some 200,000 tonnes per annum and Novacero, with initial production capacity of 120,000 tonnes per annum and projected capacity of about 250,000 tonnes per annum.

Mr Guillermo Pavón director of national metalworking industries association Fedimetal said in February 2012 that apparent steel consumption in Ecuador is expected to increase by 6% in 2012 from 1.48 million tonnes in 2011.

Source – Business News Americas

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