Rafael Ravettino, General Manager,

ACEROS CHILCA (MEPSA)

"In 2024, we expect to inaugurate our new foundry facility in Chilca, with the goal of having one big, centralized facility with 1,500 tons of monthly production of castings and 7,000 tons of grinding media."

Can you provide an overview of Aceros Chilca’s activities and main milestones achieved in 2020?

Aceros Chilca is focused on the production and commercialization of grinding media (balls) and castings, mainly for the mining industry. The castings are made through our brand MEPSA, while forged balls are part of the Aceros Chilca brand. We are currently working in a strategic relationship with our bars supplier to develop balls that are specific to each type of mineral and mine site, looking to increase our customers’ productivity and decrease cost of operation.

2020 was a tough year as the halt in the mining sector meant that there was a lower demand for steel. This affected our projections and, despite our positive results, we did not reach our objectives. However, 2021 has started very favorably, possibly due to high metal prices, as mines are aiming to increase production. Aceros Chilca has changed the strategy and is currently working with customers to provide them with cast steel liners for crushers and SAG/Ball mills. This has allowed us to maintain significant volumes and make interesting developments in our alloys, being able to provide our customers products that exceed their expectations, especially in terms of mineral processability.

Which of Acero Chilca’s products and solutions have been in high demand in Peru’s mining sector in the past year?

Aceros Chilca has two main products that have been in high demand: forged balls, ranging from one to three and a half inches; and wear spare parts. We add value to our sales process with an effective presence in the mine and with valuable engineering services: we scan the mills and develop new designs jointly with our customers to achieve new alloys that allow them to process the mineral further. In the past, we produced an average of 8,000 tons of casted balls per month. However, the industry has migrated through the years to forged balls, which are much more wear resistant, reliable, and allow to process more ores.

What solutions are being introduced in the supply chain to improve efficiency and reduce costs?

The strategic association with our bars suppliers allows us to improve the product’s chemistry and manufacturing the bars for Aceros Chilca carries out the whole process of transformation to produce the balls, through the heat treatment, achieving the characteristics that customers need. We are currently trying to develop balls that have greater durability together with clients. Similarly, regarding the production of pieces, we are present in the mines working together with our customers, which allows us to understand their needs in terms of alloys or the design that allow greater performance and productivity.

What initiatives does the company have in terms of social responsibility?

Our group promotes education in Peru and Chile, especially in reading and comprehension, through the Foundation in Peru - Margot Echecopar and in Chile - Sara Raier Rassmus (www.fsrr.cl). As a result of the pandemic, we have also taken measures to support and protect our workers, and the people who are close to our operations, providing them with oxygen and tests. 15 days after quarantine was established in Peru, we started operating again, as we had important contracts to fulfill our commitments, involving the delivery of over 1,000 tons per month. Fortunately, we have not had any fatal cases of Covid-19 thanks to our powerful protocols.

What are Aceros Chilca´s objetives for 2022-2023 and the opportunities you see for growth?

In 2021 we expect to grow by approximately 30% in terms of castings, and 20% in terms of grinding media. We are off to a good start, as we have already received purchase orders fulfilling a large part of our yearly production. This gives us the opportunity to keep working and looking for new customers orders, as clients request them in terms of their wear. In 2024, we expect to inaugurate our new foundry facility in Chilca, with the goal of having one big, centralized facility with 1,500 tons of monthly production of castings and 7,000 tons of grinding media.

We also see important opportunities in the export market, as there are significant investments being made in the mining industry worldwide and we have plenty experience exporting our products. Aceros Chilca plans to reach these markets through partnerships with the main OEMs. We currently export to Chile, Canada, USA, Brazil and Mexico but plan to broaden the horizon of our company towards Europe and Asia.

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