Liberty Ostrava Resumes Production at Hot Strip Mill After Yearlong Hiatus
Czech steelmaker Liberty Ostrava, part of the Liberty Steel group, has officially resumed production at its hot strip mill, marking a significant development for the company after a break of more than a year. This move comes after discussions surrounding the company’s future, with Liberty Ostrava currently in the process of being sold. The resumption of production is seen as a key milestone in maintaining the company's operational viability as it heads towards a potential sale.
Tolling Agreement with Vítkovice Machinery Trade
Since August of last year, the production of flat products has been financed by Vítkovice Machinery Trade, a Czech engineering group under the CE Industries group, through a tolling scheme. Under this arrangement, raw material slabs are imported and processed into various steel products, which are essential in the manufacturing of flat steel products such as coils, sheets, and steel strips. Tolling allows Liberty Ostrava to keep its operations running while also generating revenue without directly purchasing the raw materials.
Tomáš Mishinger, Director of Vítkovice Machinery Trade, highlighted the significance of this collaboration, stating, “This is another important milestone for us. The production of flat products such as coils, sheets, and steel strips, which we are now reintroducing to the market, is returning to Liberty’s portfolio.”
Production Plans and Market Goals
The hot strip mill’s resumption of production is expected to yield approximately 45,000 metric tons per month initially, with plans to increase this volume to 70,000 metric tons per month by June 2025. These volumes are crucial for meeting the demand for steel products in both the local and global markets. The steel produced will also be used in Vítkovice Machinery Trade’s own operations, such as the manufacturing of beams and pipes, helping the company reduce production costs by using the steel it produces internally.
Michal Stefal, a spokesperson for the bankruptcy trustee managing Liberty Ostrava’s case, emphasized the importance of restarting the rolling mill. He pointed out that this initiative plays a vital role in preserving the company’s value during the ongoing process of its sale. The ability to resume production and generate steel products is a key factor that will ensure Liberty Ostrava remains an attractive asset for potential buyers.
Short-Term and Long-Term Production Plans
Currently, the production at the hot strip mill is expected to continue until April 2025. However, there will be a brief shutdown in early February 2025 to adjust the heating furnace, a necessary step to ensure optimal production quality. Despite this brief interruption, Liberty Ostrava aims to ramp up production capacity quickly and stabilize its output in the coming months.
Impact on the Czech Steel Industry
The resumption of Liberty Ostrava’s hot strip mill is seen as a positive sign for the Czech steel industry, which has faced a series of challenges in recent years, including fluctuating demand and shifts in global market conditions. By reintroducing these essential steel products into the market, Liberty Ostrava is helping to stabilize the industry and meet the ongoing demand for quality steel products, especially in the construction and manufacturing sectors.
Moreover, the collaboration with Vítkovice Machinery Trade reflects a strategic move to maintain production while minimizing costs. This partnership is expected to play a pivotal role in the transition period leading up to the company’s sale, helping ensure that Liberty Ostrava can maintain its market position and continue providing steel products to customers.
With the planned increase in production volumes and ongoing operational improvements, Liberty Ostrava is positioning itself to be a key player in the region’s steel market, even as it navigates through its restructuring phase and eventual change of ownership.
