by Dan Conti, Kentucky Public Radio
AK Steel is buying a Pennsylvania coal company in a deal designed to help control raw material costs at its Ashland, Kentucky and Middletown, Ohio plants. Company president James Wainscott announced today that the firm has acquired Solar Fuel Company of Somerset County, Pennsylvania for $36 million.
Wainscott says in recent years, AK Steel has lost money because it didn’t own metallurgical coal–the raw material for steel.
“Increasing global demand for commodities such as coal and iron ore has caused the purchase prices for these and other steel-making inputs to skyrocket,” he said. “And as a result our margins have been severely squeezed.”
Wainscott says owning the coal will change that. He says AK hopes to begin limited mining in 2013. Wainscott spoke during a press conference from the company’s corporate headquarters.