Caparo Merchant Bar

Caparo Merchant Bar is the UK’s largest producer of steel flats and light sections with amanufacturing capacity in excess of 400,000 tonnes per annum
You can’t make it without steel

Caparo Merchant Bar is the UK’s largest producer of steel flats and light sections with amanufacturing capacity in excess of 400,000 tonnes per annum

Just about everything we use either contains steel or has been made using steel. Whether it is bolts or building, clothes or chemicals, food or fast cars, lamps or lemonade, they all depend on steel at some point in the manufacturing process. Even industries producing materials like glass, aluminium and plastics need steel.

Caparo Merchant Bar (CMB) is the UK’s leading producer of steel flats and light sections with a manufacturing capacity of more than 400,000 tonnes per year. The site consists of two fully automated steel rolling mills that utilise state-of-the-art technology providing efficient production facilities. The company is committed to customer service and prides itself on an extensive product range, a quality reputation and a highly productive and committed workforce.

CMB is located on the Corus site at Scunthorpe and has a shared ownership (75 per cent Caparo Industries and 25 per cent Corus). The relationship with Corus is close, with the company sourcing most of its raw material (billets) and purchasing gas, electricity, air and water from them.

CMB’s managing director, Richard Morley, talks further about the history of this division of Caparo: “In 1985, Caparo Industries and Corus, or British Steel as it was then, embarked on an exciting venture to bring modern merchant bar production to Scunthorpe – creating CMB and, over the years, often in spite of fluctuating market conditions, we have made a number of significant investments, enabling us to improve as an organisation and grow into the UK’s largest specialist producer of merchant bar.”

He continues: “Our business is doing very well and Caparo have demonstrated their confidence in it by investing large amounts of money over the last 20 years. Investment plays an important role in our business strategy, as we believe that investment, together with constant improvements in the range of specifications available, will offer to our customers the widest range of merchant bar products available, and grow our business. Our commitment therefore is to provide products and customer service to the highest possible standards.”

Richard adds” “There is a need to continually invest in technology to stay in the game. Technology, however, does not yet get you ahead of the game nowadays, rather it is what you do with it. The real competitive advantage therefore comes from people. It is how plants are run and managed that makes the difference between each company’s performance, and so, at CMB we invest not only in our plant, but also our people.”

“The other key area of competitive advantage is customer service (and this is again down to people), since in merchant bar there is no real product differentiation. Merchant bar products rolled at CMB are the same products as those produced in Turkey, Italy, China or Spain, and so it is important to differentiate on service to the customer. If you give a good customer service, you will retain your customer base.”

As part of the company’s efforts to continually improve, CMB recently commissioned and built a brand new Roughing Mill purchased from Siemens VAI and ABB. The investment signals an attempt to increase the product range, and extend the customer base. “The Roughing Mill was installed this August, and was done for two reasons really,” explains Richard, “to increase our billet size allowing us to expand our product range, and to give us much more flexibility in our operations.

“Flexibility is important in Merchant Bar production in order to adapt to market needs either in volume or products and enriching our product mix is paramount to our business strategy. In the future we will have a much greater product range and will invest further to become even more flexible, enabling us to respond quickly to changes in the market demand.

Currently CMB considers over 40 per cent of its product range to be special, either by virtue of steel grade, size or length and these products are produced in response to its customers’ demand and the increased growth in these products over the years is testimony to the company’s commitment to meeting the customers’ requirements every time.

Competition from both inside and outside the EU will always be present and competing on low cost standard products becomes more difficult in the light of competition from developing nations, who have a much cheaper cost basis.

CMB’s strategy of flexibility, product mix enrichment, and excellent customer service should ensure it continues to compete successfully in a tough merchant bar market.