Big River Steel project taking shape, impacting Northeast Arkansas

by Michael Wilkey ([email protected]) 309 views 

Tyronza Mayor Charles Glover said Monday that the sight of a $1.3 billion steel mill down the road in Osceola can do nothing but help his small Poinsett County town grow. Meanwhile, the project is moving into another phase, a company official said.

Chief Commercial Officer Mark Bula said construction has continued in spite of recent rains. Structured steel has been installed throughout the 1,300-acre facility south of Osceola on U.S. 61. Bula said crews just installed the first piece of vertical equipment at the mill, with the batch and skin pass mills at the facility ready to open by March 2016.

The journey from start to near finish has been challenging, several have said.

The company’s CEO, John Correnti, unexpectedly died earlier this year at age 68 during a business trip to Chicago. Bula said Correnti provided instant credibility for the project and gave employees at the company something to strive for.

“John knew how to attract talent. He was a hands-off manager but he expected results,” Bula said, noting “we owe it to him to get it built.”

Bula noted that people in Mississippi County are anxious to see the mill open. Construction crews began building the mill in late 2014, nearly a year after the Arkansas legislature approved $125 million in bonds to bring the mill to Osceola.

Bula said the company plans to start hiring people early next year, with officials from Arkansas Northeastern College (ANC) helping with job fairs. Company officials are teaming up with ANC to develop a strategy on workforce development and training people to work in a sometimes difficult field, Bula said. The company is expected to hire around 450 people to work at the mill. Right now, there are between 1,200 and 1,500 construction workers helping to build the mill each day, Bula said, noting he expects a peak of about 2,000 construction jobs in the future.

The company’s chief executive officer, Dave Stickler, also told a legislative committee in August that the company has pre-sold nearly a quarter of the steel it is expected to produce over the next seven years. Bula said he expects the company to do well, with meeting a niche market and competing with so-called integrated mills in the Great Lakes area.

“The interest level is good,” Bula said of the market.

While the mill is still being built, Bula said he is optimistic for future growth and a possible expansion. “I believe it will happen sooner or later,” Bula said.

The steel industry, which has its beginnings in the Northeast, has seen some growth in the Southeast in the past 20 years or so. Bula said several companies, which work in developing motors and other products, have moved to Mexico in recent years. However, the move has been stopped in some part due to Mitsubishi opening a plant in Memphis in 2013, Bula said.

As for when the project is done, the mill is expected to provide a residual effect on the local economy. Bula said he is hopeful that many of the people hired can be local folks with the people spending money locally, buying homes and raising their children in the area.

Osceola has seen an uptick in recent years, with a new Walmart Supercenter and several restaurants opening. Another key part that is needed includes hotels and more restaurants, Bula said. He said he would like to see someone build a coffee shop in town, with Internet access not to mention building loft apartments and condos in downtown Osceola.

REGIONAL IMPACT, BENEFITS
Both Glover and Osceola Mayor Dickie Kennemore said Monday that the project will benefit their towns. Kennemore said the city has seen an uptick in houses being bought not to mention interest in rental property going up.

Since construction began, other companies have moved in, Kennemore said. At least 450 jobs have been created in the past year or so, with companies like SMS, Steel Warehouse and Mid-River Terminal moving in, Kennemore said.

SMS, a millcraft company, announced earlier this year a $30 million investment while Mid-River Terminal (a barge unloading company) announced a $40 million investment at a facility in Osceola.

Even more has been the uptick in optimism, Kennemore said. “If anything, it has caused the mental outlook (around town) to be positive,” Kennemore said.

Nearly 30 miles down the road in Tyronza, the opportunity from the mill is seeing some benefit.

Glover said Tyronza is a bedroom community, located halfway between Jonesboro and Memphis. The Big River Steel project is also 30 minutes away from the town. “We are in a prime location. We have U.S. 63, good access and a nice, clean town,” Glover said.

Glover said his town is taking a wait-and-see approach on the housing issue. He said while he believes that the land in and around town could be sold to a developer to build homes, the cost to build homes is going up.

“It is so expensive to develop houses,” Glover said, noting it would cost as much as $12,000 a lot to build a house.

He added that nearby Marked Tree and Lepanto are looking at ways to connect their water systems to one another.
A key reason is to prepare for the possible growth, along with the need of increased water pressure, as well as helping each other out in case of emergency, Glover said.

Keith Forrester, a co-owner of Tyboogies, a restaurant in town, said his restaurant has seen some customers from the mill. Glover, who worked for Ritter Agriculture before retiring, said the project can provide some dividends.

“Everybody in this part of the state will benefit. I mean, 1,000 jobs in Northeast Arkansas, will benefit everybody,” Glover said. “We are in an ideal location to capitalize and it will be a big help to the economy in Northeast Arkansas.”

Glover, who is also a licensed pilot, flew over the Big River Steel project Sunday. He said he was impressed by the work done.

“It is a big plus for us – a good water supply, good soil and access to the Mississippi River,” Glover said of the region. “We have great access to business and great transportation with the river, I-55 and I-40 in West Memphis and the Memphis airport with Fed Ex. Also, economic activity increases the tax base and you do not have to raise taxes. I am looking forward to it. I would say that Northeast Arkansas is in the place Northwest Arkansas was 20 to 25 years ago.”

Big River Steel is expected to have a grand opening in Oct. 2016.