Silicon metal getting a rebirth — Investors are betting new technologies and efficiencies can make product competitive in U.S.
Silicon metal manufacturing largely died out in the United States more than three decades ago, done in by the large volume of raw materials required to produce the multi-purpose alloy and an inability to compete with cheaper foreign imports.
However, technological advances, new manufacturing efficiencies and long-awaited U.S. trade protections have brought a reversal that may make a comeback possible. Added motivation comes from a new generation of industrial products and household goods for which silicon is a critical ingredient.
“The timing is perfect” in terms of market demand, said Mississippi Silicon Metal’s President & CEO David Tuten in an interview last week, citing a growing shortfall in the domestic supply of silicon.
» NEXT WEEK — The MBJ reports on how Tishomingo County’ is using the Tennessee-Tombigbee Waterway to help it rebound from big economic development disappointments of earlier decades.
That’s the thinking Tuten’s Mississippi Silicon and partners Rima Holdings USA and investor group Clean Tech, LLC have adopted as they break ground Monday on a state-of-the-art plant in Tishomingo County’s Burnsville. The project represents a $200 million investment, including a $21 million contribution from the State of Mississippi, and is expected to generate 200 jobs in the county located in a far corner of Northeast Mississippi’s border with Alabama and Tennessee.
Rima Holdings is a subsidiary of Brazil’s Rima Industrial S/A, an employer of 4,000 workers and producer of a quarter of the world’s silicon.
Forty years ago as many as two dozen companies made silicon metal alloys in the United States, according to Tuten. “Now it’s down to just a couple of companies (Rima Holdings USA and Global Specialty Metal).”
A new plant has not been built in the United States since 1976, added Tuten, a South Carolina native and the third generation of his family to be in the silicon manufacturing business.
In leading the U.S. entry back into silicon manufacturing, Mississippi Silicon expects to continue competing against lower-cost Chinese, Russian and Third World silicon products whose makers face few of the environmental and other regulations to which U.S. operations must adhere.
“We’re constantly trying that battle,” Tuten said of the cheaper foreign imports.
Some leveling of the competitive field has come from the U.S. government allowing more anti-dumping lawsuits. “Now we have mechanisms in place that give us some protections, he said.
In an industrial battle in which only the fittest survive, Mississippi Silicon’s hand is further strengthened by advances and cost-savings in converting raw materials into silicon. “We feel that the time is right to build,” Tuten said. “There have been so many advances in technology and equipment that we have many advantages.
Energy efficiency is key when you make a product that requires six tons of raw materials for each ton of silicon, he noted.
Tuten said sitting at the confluence of the Tennessee River and the Tennessee-Tombigbee Waterway ensures cost-effective delivery of Eastern Kentucky coal, a vital raw material for silicon, and the efficient export of the finished product either into the U.S. interior or down the Tenn-Tom to the Gulf of Mexico.
Burnsville also has close proximity to the Central Alabama quartz gravel pits and Northeast Mississippi’s hardwood — two other main materials for making silicon metals, Tuten said. “Silicon metal is not really a metal; it’s an alloy.
We use the raw materials that come from Mother Nature and turn them into an alloy product.
“It’s a good marriage all the way around,” he said of the plant’s location.
The alloy is used to strengthen such industrial products as aluminum automobile wheels and to make a host of household products, among other uses, Tuten noted.
By-products from the manufacture include slag that is sold to steel makers and smoke from the silicon plant’s furnace that is sold to the concrete industry. The silicon fumes are used to strengthen concrete in structures such as high-rise buildings and highway overpasses.
The manufacturing process does not create waste products and “has basically zero water discharge,” Tuten said, and added the Burnsville plant has all required environmental permits, including state and federal air permits.
John Lalley, Mississippi Silicon’s vice president for finance, said the $200 million in investment for the plant is fully committed. “We have begun to draw down on the funds for initial spending requirements and continue to access the money as needed for construction,” he said in an email.
The Burnsville operation and the creation of Mississippi Silicon is an endeavor separate from that of Silicor Materials, a California-based company originally named Calisolar that proposed a $600 million silicone purification plant in Lowndes County. The purification process Silicor sought to undertake was to lead to the assembling of energy cells for conventional aluminum-framed, glass-encapsulated solar modules. The effort never got off the ground and received no draws from $75 million in loan incentives offered up by the Mississippi Development Authority.
Tuten emphasized that “Mississippi Silicon is completely separate” and has a more conventional industrial focus. “We have not accepted anything that they have mapped out,” he said.
Instead, Tuten said, what is going up in Burnsville “is a very old business yet one that is very new and is getting a rebirth.”
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