Metals Watch

JAPANESE STEEL RESTRUCTURES

Japanese steelmakers, operating in their harshest economic environment in some time, are in the midst of sweeping restructuring programs. "The renovation of management systems now underway is a radical one," says Hiroshi Saito, chairman of the Japan Iron & Steel Exporters’ Association. The programs include: a 25 percent reduction in overall workforce; consolidation of production; increased procurement from offshore and expanding investment in Asia; cutbacks in capital expenditures; and trimming of research and development budgets. The cumulative cost savings of the restructuring efforts is expected to save Japanese steelmakers an estimated $10 billion.

In 1995, the consensus in Japan was for a gradual, yet firm economic recovery, which had already started in early 1994, according to Saito. However, the economic recovery was undercut by both the devastating Kobe earthquake and the rise of the yen to an extremely overvalued level – 80 yen to a dollar – during the first half of the year.

The unfavorable conditions forced Japanese steel mills to reduce production levels, and it is now expected that Japanese steelmaking will be less than 100 million metric tons for 1995.

And Saito says that the prospects for increasing steel consumption are not bright.

FIRSTMISS STEEL TO INCREASE STAINLESS

FirstMiss Steel Inc., Hollsopple, Pa., has announced that it will increase production of stainless and other high alloy steels as part of a major facility improvement program. The upgrade calls for the installation of a converter that will be used as an intermediate decarburization and refining step between a recently installed 52-ton capacity electric arc furnace and an existing vacuum oxygen decarburization unit. The combination of EAF, converter and VOD has become known as the "Triple Process" in the industry. The new converter will have a 65-ton capacity with a nominal charge of 55 tons.

ALUMINUM MILL PRODUCT SHIPMENTS STAY ROBUST

Service center shipments of aluminum mill products remained strong in the final months of 1995, according to the National Association of Aluminum Distributors, Philadelphia. For October, shipments were up 6.5 percent above shipments for the same period in 1994, and ship-ments in November were up 5.1 percent.

"As the year closes on another record level of activity, industry crystal balls look optimistic for a third consecutive sales volume record in 1996," says Kenneth Hutton, NAAD’s executive vice president.

SILVER INVENTORIES DWINDLE RAPIDLY

The current stockpile of silver is rapidly being used up, leading to an increase in prices and lower inventories, according to The Silver Institute, Washington. Existing inventories, accumulated from 1978 through 1987, have been dwindling since 1992 and may be exhausted by 1998. Within two years, the price of silver could reach $10 an ounce, the Institute reports.

NEW BRASS AND BRONZE INGOT MAKER OPENS

Starting in January, Phoenix International, Hamilton, Ontario, under the direction of company president Monty Levy, has been operating as a producer of brass and bronze ingots for the casting industry. Phoenix is one of only two such smelters and refiners in Canada, according to the company.

GRIFFIN TO OPEN N.C. AUTO SHREDDER

D.H. Griffin Wrecking Co., Greensboro, N.C., is opening a second scrap metal processing yard on 40 acres in Raleigh, N.C. The $6 million facility, which is expected to be operational by mid-summer, will include a $2 million auto shredder – the only one in eastern North Carolina. Existing shredders in the state are located in Charlotte, Statesville and Kernersville, according to David Griffin Jr., vice president, and are a long way from Raleigh.

"In the past, cars had to be hauled from the Raleigh area all the way to Kernersville, or even into Virginia or South Carolina," says Griffin.

The facility will be a full-service scrap yard, buying and selling all types of scrap metals.