MEMPHIS, Tenn. — Nucor Corp. announced Friday it will open a $230 million steel mill in Memphis as part of its expanding domestic steel operations.
The company, based in Charlotte, N.C., will employ more than 200 people at the Memphis plant, which will start production in the first quarter of 2008.
In July, Nucor announced plans to build a steel mill somewhere in the South, with an estimated annual capacity of 850,000 tons.
The company said the Memphis plant would produce high-quality carbon and alloy rounds and round-cornered squares for the automotive, heavy equipment and service-center markets.
Tennessee Gov. Phil Bredesen told Nucor officials he hoped to announce Nucor expansions in Memphis in the future.
"In my opinion, this is just the marriage license — we're starting down the road here together," Bredesen said.
Nucor already has a shuttered steel facility and other property in Memphis that it bought from Birmingham Steel in 2002. It will renovate and expand the existing mill in the city's Frank C. Pidgeon Industrial Park.
Birmingham Steel built its Memphis steel mill in 1995, but closed it in January 2000, laying off about 220 workers.
Nucor is taking advantage of new corporate tax incentives that the state of Tennessee approved earlier this year.
A company that makes a $100 million investment and creates 100 new jobs gets a three-year tax break. A $250 million investment with 250 new jobs gets a six-year credit.
The state is also paying for infrastructure improvements and work force training, and the city and county are contributing $25 million in incentives.
While traditional steel makers suffered in the 1980s and 1990s, Nucor increased its share of the domestic steel market by focusing on using scrap instead of converting raw materials. It is the nation's largest recycler and has facilities in 17 states.
Daniel R. DiMicco, the steel maker's chief executive, has embarked on an expansion push, in the last year announcing a $27 million facility in Utah and an expansion to its existing mill in Decatur, Ala.
"This growth project provides Nucor with an exciting opportunity to capitalize on a significantly better cost structure compared to our key competitors in the 'special bar quality' market, both domestic and foreign," DiMicco said.