Final Thoughts

March 7, 2018

I am in Scottsdale, Ariz., attending the Fabricators and Manufacturers Association (FMA) annual meeting. I was asked to speak on a panel with Nucor Executive Vice President for Flat Rolled Ladd Hall and Don McNeeley, President of Chicago Tube and Iron. The timing of the conference couldn’t have been better for the fabricators, toll processors and service centers who made up the majority of the 300 attendees. President Trump was the main topic since he was about to announce his final decision on Section 232 tariffs.

Dr. Chris Kuehl of Armada Corporate Intelligence and FMA’s Chief Economist began his comments with, “We have been treating the steel industry as an industry bastard-child for years.” That theme leaked into other presentations including the Packard, Hall and McNeeley panel.

The opinion of those on my panel was that the 25 percent tariff the president was about to announce was nothing more than a negotiating position, giving the president some leverage over NAFTA negotiations and trade negotiations with others around the world.

A number of the manufacturing companies in the audience were concerned about their ability to compete against foreign manufactured products. They are also concerned about what will happen when they have to re-quote manufactured parts to end OEMs, and then that business is shopped because of the severe increase in steel costs.

I will have much more on the FMA conference in Sunday’s issue of our newsletter.

As always, your business is truly appreciated by all of us here at Steel Market Update.

John Packard, Publisher