To obtain a strategic foothold in South America, Elkem has entered into a 50/50 joint venture with the Argentinean investors Grupo Andreani and Grupo Araujo to build a new ferrosilicon plant close to the Paraguayan capital, Asuncion. The new plant will create around 100 new jobs and is scheduled to start production in Q2 2015.
On the evening of Feb 12, Jean Villeneuve, senior-vice president in Elkem Foundry, announced a new plant plan at a business event at the Hotel Guarani in Asuncion, Paraguay. Villeneuve informed government officials and the other participants of the project plans, detailing why Elkem wants to build the plant in Paraguay together with Argentinean partners.
“South America is one of the largest and fastest growing markets for ferrosilicon products. By building this plant, we will acquire a local presence in a growing market and obtain an important strategic foothold for further development of our business. With access to local raw materials and sustainable hydropower, Paraguay is for us a perfect place in which to develop our business,” said Villeneuve.
Best available technology and operational excellence
Building the new plant will start immediately, and production of ferrosilicon is scheduled to start in Q2 2015. The Paraquayan plant will consist of one ferrosilicon furnace in the first phase, but the joint venture has plans to expand in the South American country in the future.
“We have access to the best available technology and will utilize our organization’s knowledge to the fullest during building and in operations of the Paraguayan plant. We know we will be competitive in the region. Based on the outlook for growth in the global market, we are already now actively evaluating further expansions of the business,” said Villeneuve.
Local jobs and raw materials
The plant will create around 100 direct jobs, but Villeneuve also pointed out that the ferrosilicon production will create many indirect jobs as well.
“One important reason for choosing Paraguay to build the plant is local access to raw materials in our production process, such as quartz and charcoal. Using local raw materials will create additional jobs for people in this region.”
Grupo Andreani and Grupo Arauju are both headquartered in Argentina.
Araujo specializes in construction and assembly of heavy equipment for steel plants with customers all over America and Europe. It also has interests in agriculture and the commercialization of steel products. The company is also investing in a ferroalloy plant in Mendoza, Argentina.
Andreani is investing in the petroleum industry, agro industry (olive oil), and hotel and entertainment industry. It is the owner of the Hotel Guaraní in Asuncion, Paraguay.