Group Forms to Address Perceived Trade Imbalance
A collection of domestic steel scrap processing and consuming firms have formed the American Scrap Coalition (ASC) to combat what they say is a growing problem with the trade imbalance in the ferrous scrap market.
In a statement announcing the formation of the group, the ASC notes that steel scrap exports from the United States have risen from 6.3 million tons in 2000 to more than 18 million tons last year. Meanwhile, imports of scrap have been declining. Scrap imports declined 23 percent in 2007 to 3.7 million tons from 4.8 million tons in 2006. The decline, the group notes, is because many countries are imposing trade barriers to restrict steel scrap trades.
"Many of our major trading partners maintain restrictions on their scrap exports, through quotas and other export restrictions," Thomas Danjczek, president of the Steel Manufacturers Association, Washington, says. "Our government should work immediately to remove these barriers, using any and all means available."
Alan Price, president of the ASC and a partner at Wiley Rein LLP, which serves as counsel to the coalition, says, "Steel scrap trade does not occur on a level playing field. More than 20 countries, including Brazil, Russia, India and China, have enacted a series of barriers to scrap trade in order to protect their domestic steel industries." These barriers on exports are distorting trade in steel scrap, Price says, thereby raising scrap prices on the U.S. market.
The American Scrap Coalition has identified several priority issues, including:
•
Identifying and removing barriers to trade in steel scrap, which hinder U.S. companies and global competition;•
Ensuring that scrap exports are not permitted as an easy way around state, federal, and international environmental obligations; and•
Considering actions by Congress, the Commerce Department and the Office of the U.S. Trade Representative to remove trade barriers.Founding members of the American Scrap Coalition include the Steel Manufacturers Association, the American Foundry Society and the National Precast Concrete Association. In all, more than 1,500 companies are members of these associations.
In a written response, Robin Wiener, president of Institute of Scrap Recycling Industries Inc. (ISRI), Washington, D.C., states that while ISRI appreciates the ASC’s goal of a free and fair global trade market, she questions the underlying premise that that steel scrap processing and consuming industries are facing a "steel scrap export crisis."
She writes "Rather than a crisis, both the steel industry and the scrap industry are enjoying extraordinarily strong export markets due to the quick pace of global infrastructure development. In fact, finished steel exports alone have increased 81.5 percent since 2001."
Weiner continues, "Scrap and finished steel are globally traded commodities. Efforts to artificially restrict that trade can have negative repercussions that are felt around the world. One effect that economists have noted is the potential for control reversal, where the implementation of export controls actually results in the opposite impact of what was intended to be achieved. That is why we have long taken an active position in support of free and fair markets by advocating for the removal of export controls around the world. As late as last month, ISRI attended meetings where we raised the issue of the need for free- and fair-trade practices between countries and continents."
Six OmniSource Executives Resign Following SDI Acquisition
Three Rifkin brothers, as well as three other OmniSource executives, have decided to leave the company following its acquisition by Steel Dynamics Inc. (SDI), Fort Wayne, Ind.
According to a report in the Journal Gazette (Fort Wayne), six OmniSource executives have decided to leave the company, which became a wholly owned subsidiary of SDI in October 2007.
Those leaving the company are COO Danny Rifkin; Executive Vice President of Nonferrous Marty Rifkin; Executive Vice President of Nonferrous Rick Rifkin; Executive Vice President of Ferrous John Marynowski; CFO Gary Rohrs; and Vice President of Business Development Grant Schultz.
"We have decided to separate and have done so in an amicable fashion," Danny Rifkin told the Journal Gazette. "I would say there were legitimate differences that developed after the close of the transaction."
Rifkin told the paper that the differences arose over how OmniSource could "fit effectively into a new role as part of a steel company."
Ben Eisbart, executive vice president of OmniSource, has accepted a position on SDI’s corporate staff, with responsibilities in human resources and legislative and environmental affairs.
Fort Wayne-based OmniSource was founded by the Rifkins’ grandfather Irving Rifkin in 1943.
ELG Acquires Utica Alloys
ELG Haniel GmbH, headquartered in Duisburg, Germany, has acquired Utica Alloys, based in Utica, N.Y.
Utica Alloys is a processor of a range of recycled scrap, primarily super alloys. The company was established in 1965. The company has facilities in North America, Europe and China.
With the acquisition, ELG unites its existing activities in the super alloys and titanium market segments with strengthening logistics and processing services to the aerospace, power generation and chemical industries worldwide.
Utica Alloys will continue to operate under the direction of its founder, Joseph Jiampietro, who remains as managing director.
Jiampietro, together with Dimitrij Orlov, ELG’s head of this segment who will take a seat in the board of Utica Alloys and the management teams of both Utica Alloys and ELG, will continue to provide service to customers while strengthening development and expansion of business worldwide.
ELG is involved in the trading and recycling of a range of metals for the stainless steel industry. The company operates 39 locations in North America, Europe, Asia and Australia.
ELG’s products are mainly various types of stainless steel scrap and special alloys. The company also trades in primary raw materials such as charge chrome from Hernic Ferrochrome, of which ELG is a co-proprietor.
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