U.S. Industry Applauds ITC Ruling on Rebar
MSCI: Steel Inventories Decline to Lowest Point in a Year
PMA: Business Conditions Expected to Hold Steady
AIIS: China Responsible for Increase in Imports
AISI: Shipments Down from 2006, But Up from Previous Month
CBSA: Mixed Results for Copper
SSINA: Stainless Imports Up 14% Through April
Briefs

U.S. Industry Applauds
ITC Ruling on Rebar
The U.S. International Trade Commission voted last month to continue antidumping orders on rebar from seven countries: Belarus, China, Indonesia, Latvia, Moldova, Poland and Ukraine. The commission determined that revoking the orders would likely lead to continuation or recurrence of material injury to the domestic rebar industry. The ITC revoked an antidumping order on rebar from Korea, however.

As part of the five-year sunset review process, the commission voted 6-0 in favor of maintaining the orders on China and Indonesia. Maintaining the order against Ukraine passed 5-1, while Belarus and Moldova orders were approved by 4-2 votes.  The orders were continued against Poland and Moldova after 3-3 votes.

The ITC’s ruling has drawn praise from the American Iron and Steel Institute and the Steel Manufacturers Association.

“We applaud the ITC’s decision. Our trade laws in place are consistent with World Trade Organization rules, and it is vital that the U.S. government enforces them,” says Thomas Danjczek, SMA president. “U.S. imports of steel continue to remain at alarming levels, and this decision of the ITC will prevent the domestic market from being subjected to additional sharp increases in illegally dumped imports of rebar.”

“We cannot open the floodgates to dumped imports of rebar or any other steel product, because this would threaten the health of America’s competitive, world class steel industry,” says Andrew Sharkey III, president and CEO of AISI. “This is especially the case with regard to China, whose steel industry has enormous excess capacity and is the most heavily subsidized in the world.”

According to U.S. Census Bureau statistics, the U.S. imported 2.35 million net tons of rebar in 2006, up from 1.29 million net tons the previous year, an increase of approximately 82 percent.

The American Institute of International Steel was disappointed with the ITC’s decision favoring domestic rebar producers. With the healthy profitability of the domestic rebar industry—nearly twice the profit level of the entire steel sector in 2006—and strong demand for rebar worldwide, this decision is inexplicable, asserted David Phelps, president of AIIS.

MSCI
Steel Inventories Decline to Lowest Point in a Year
U.S. and Canadian shipments of steel and aluminum continued a long downward trend in June, and inventories of both metals reached their lowest levels in a year or more, according to the latest Metals Activity Report from the Metals Service Center Institute, Rolling Meadows, Ill.

Inventories of steel products at service centers fell to the lowest level since March 2006 in the United States and May 2006 in Canada. U.S. aluminum inventories at the end of June were at their lowest level since July 2005, while Canadian aluminum inventories fell to their lowest level since September 2004.

Steel product activity
Shipments of steel products from U.S. service centers totaled 4.4 million tons, a decline of 14.3 percent from the same month a year ago, and the 10th consecutive month of year-over-year shipment reductions. Canadian steel shipments fell 13.6 percent, to 311,800 tons, marking the 11th consecutive month of year-over-year declines there.

Steel product inventories at U.S. service centers stood at nearly 13.9 million tons, down 5.7 percent from July 2006 and 17.4 percent lower than the cyclical inventory peak of nearly 16.8 million tons reached in October 2006. At June shipping rates, U.S. steel inventories equaled a 3.2-month supply. Canadian steel inventories fell 6.1 percent below year-ago levels to 1.2 million tons, a 3.9-month supply at June shipping rates.

Aluminum product activity
Shipments of aluminum products from U.S. service centers totaled 96,600 tons, or 10.1 percent less than during June 2006. Canadian aluminum shipments of 11,400 tons were down 2.5 percent from a year ago.

Aluminum inventories in the United States at the end of June totaled 325,200 tons, down 10.9 percent from a year ago and equal, at June shipping rates, to a 3.4-month supply. Inventories at Canadian service centers totaled 27,000 tons, down 19.3 percent from June 2006 and, at June shipping rates, sufficient for 2.4 months.

PMA
Business Conditions Expected to Hold Steady 
According to July’s Precision Metalforming Association Business Conditions Report, metalforming companies expect business conditions to remain steady during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 166 metalforming companies in the United States and Canada.

Twenty-three percent of participants expected conditions to improve in the next three months, the same as in June. The majority, 60 percent, expected conditions to remain the same (compared to 52 percent in June), while only 17 percent expected a decline (down from 25 percent in June).

Metalforming companies also expect little change in incoming orders during the next three months. Thirty-two percent of respondents forecast an increase in orders, while 19 percent expect a decrease, and the rest anticipate no change.

AIIS
China Responsible for Increase in Imports
Steel imports increased in May over April by 12.7 percent based on preliminary reporting from the U.S. Census Bureau, but were down 18.5 percent compared to May 2006.  

“The increase in imports in May from April reflects two factors,” says David Phelps, president of the American Institute for International Steel, Washington, D.C. “The large increase from China is a direct response to anticipated changes in VAT rebates and export licensing, which were under consideration by the Chinese central government at the time these products were ordered.  Some orders were clearly advanced in anticipation of these significant changes in the terms of trade, which have now been announced by the Chinese government.”

Phelps added that the import increases were primarily in rebar and wire rod, reflecting the strong non-residential construction market.

Total steel imports in May were 3.21 million tons compared to 2.8 million tons in April. According to year-to-date figures, imports decreased 22.1 percent compared to the first five months of 2006, from 18.9 million tons in 2006 to 14.7 million tons in 2007. 

AISI
Shipments Down from 2006,
But Up from Previous Month
U.S. steel mills shipped 9.1 million tons in May, an 8.2 percent decrease from the 9.9 million tons shipped in May 2006, according to the American Iron and Steel Institute, Washington, D.C. The May shipments represented a 2.6 percent increase from the 8,849,000 net tons shipped in the previous month, April 2007.

A year-to-year comparison of year-to-date shipments shows the following changes within major market classifications: service centers and distributors, down 9.3 percent; automotive, down 2.4 percent; construction and contractors’ products, down 2.6 percent; and oil and gas, down 9.5 percent.

CBSA
Mixed Results for Copper
The average daily shipping rate for copper and copper alloys during June was 2.2 percent ahead of May’s pace, reports the Copper and Brass Servicenter Association, Wayne, Pa., but total shipments month-to-month declined by 2.5 percent.

While shipments of copper rod and bar by service centers were up 3.2 percent in June, other large volume categories declined, including copper sheet, down 2.7 percent, 7030 brass sheet, down 1.3 percent, and 300 series rod and bar, down 0.1 percent.

In total, copper shipments declined by 2 percent in the first six months of the year, vs. the companion period last year, while alloy shipments dropped by 12.5 percent.

Despite the relatively weak first half, a CBSA survey of service center and mill members reveals general optimism about shipments for the rest of 2007.

SSINA
Stainless Imports Up 14% Through April
Imports of stainless steel through April totaled 332,465 tons, a 14 percent increase vs. the first four months of 2006, according to the latest data from the Specialty Steel Industry of North America, Washington, D.C.

Year-to-date data for individual product categories is as follows:

• Stainless steel sheet/strip: Imports were 143,686 tons, a 7 percent decrease; U.S. consumption was 537,946 tons, a 10 percent decrease.
• Stainless steel plate: Imports were 45,096 tons, an 85 percent increase; U.S. consumption was 130,875 tons, a 32 percent increase.
• Stainless steel bar: Imports were 43,345 tons, a 24 percent increase; U.S. consumption was 84,295 tons, a 17 percent increase.
• Stainless steel rod: Imports were 11,489 tons, a 9 percent increase; U.S. consumption was 24,632 tons, an 11 percent increase.
• Stainless steel wire: Imports were 15,422 tons, reflecting zero percent change; U.S. consumption was 28,837 tons, a 2 percent increase.
• Alloy tool steel: Imports were 37,238 tons, a 9 percent increase; U.S. consumption and import penetration were not calculable.
• Electrical steel: Imports were 36,189 tons, a 100 percent increase; U.S. consumption was 147,138 tons, an 11 percent increase.

Imports of total specialty steel (comprising stainless steel, alloy tool steel and electrical steel) were 332,465 tons, a 14 percent increase vs. the same four-month period in 2006, while U.S. consumption was 984,252 tons, a 1 percent increase. Four-month import penetration was 34 percent, a four percentage point increase.

BRIEFS
Economic activity in the manufacturing sector expanded in July for the sixth consecutive month, while the overall economy grew for the 69th consecutive month, say the nation’s supply executives in the latest Manufacturing ISM Report On Business from the Institute for Supply Management, Tempe, Ariz. “Following a strong second quarter, the manufacturing sector moderated somewhat this past month,” says Norbert J. Ore, chair of ISM’s Manufacturing Business Survey Committee. “In July, manufacturing expanded at its slowest pace in the last four months, but continuing strength in New Orders and Production indicate that third-quarter performance should still be quite good.”

Manufacturing growth slowed in July as the PMI registered 53.8 percent, a decrease of 2.2 percentage points when compared to June’s reading of 56 percent. A reading above 50 percent indicates that the manufacturing economy is generally expanding.

“The past relationship between the PMI and the overall economy indicates that the PMI average for January through July (53.1 percent) corresponds to a 3.5 percent increase in real gross domestic product annually. In addition, if the PMI for July (53.8 percent) is annualized, it corresponds to a 3.7 percent increase in real GDP annually,” Ore notes.

The National Association of Manufacturers has joined as Industry Partner with the FABTECH International and American Welding Society Welding Show to be held at McCormick Place in Chicago Nov. 11-14. The show is North America’s largest event dedicated to showcasing a full spectrum of metal forming and fabricating equipment and technology. It is sponsored by the American Welding Society, the Fabricators & Manufacturers Association and the Society of Manufacturing Engineers. The show will occupy more than 450,000 square feet, with 900 exhibitors and 25,000 attendees expected.