Big River Steel of Osceola said Wednesday that it entered an agreement with Koch Metallics LLC under which Koch will act as the exclusive agent to Big River Steel for metallics procurement.
Koch Metallics is a subsidiary of Koch Minerals & Trading LLC. Koch Minerals is a major investor in Big River Steel, which said the partnership will "improve metallics procurement by leveraging Koch's networks, capabilities and potential for providing additional services in support of Big River Steel's growth initiatives."
The company said the partnership positions the plant for improved earnings "by providing scale and efficiency gains, thereby reducing raw material costs."
As part of the partnership, Martin Baker, Big River Steel's metallics procurement manager, will join Koch as metallics procurement and conversion manager.
"Martin is a proven professional and I am fully confident that Martin joining the Koch team will lead to new and expanded relationships with forward thinking domestic and international metallics providers and steel consumers," Big River Steel CEO Dave Stickler said in a news release.
Big River Steel is in the process of doubling its annual steel production capacity from 1.65 million tons to 3.3 million tons. The company said the expansion is ahead of schedule and should be complete before the end of the year.
At $1.3 billion, the Big River Steel plant was a major economic development project assisted by the Arkansas Economic Development Commission and the state Legislature, which in 2013 approved a multimillion-dollar package of incentives for the plant, including a $125 million bond issue under Amendment 82 of the Arkansas Constitution — the first time the "superproject" legislation was implemented.
In 2014, Arkansas Teacher Retirement System trustees authorized investing up to $125 million in Big River Steel. Koch Minerals, a subsidiary of Koch Industries of Wichita, Kansas, was an early — and major — investor in Big River Steel.
Construction on Big River Steel began in September 2014, and the company processed its first batch of steel in 2016.