Industry experts discuss state of manufacturing, steel prices at TPJ Symposium

June 8, 2004

The second annual TPJ Symposium, which was held Feb. 18-20 in Orlando, Fla., was an industrywide gathering of executives and managers from the tube production, tube fabrication, and equipment manufacturing industries. The symposium was kicked off with a keynote address by William Strauss, senior economist and economic adviser for the Federal Reserve Bank of Chicago. Although the manufacturing sector has had a tough time since late 2000, Strauss pointed out that the economy as a whole has demonstrated remarkable resilience during the last few years.

"I'm impressed with the performance of the economy," he said. Despite some deep troubles, economic growth has held up well during the past few years. "We've had three losing years in the stock markets, which we haven't seen since the 1920s." And despite the recession, which was just ending when the terrorist attacks of Sept. 11, 2001, sent a shock wave throughout the U.S. economy, gross domestic product rebounded and has stayed in positive territory ever since. Strauss cited the shedding of inventories and productivity improvements as two of the main components of this business cycle that have allowed many companies to maintain some profitability despite the decline in overall business activity.

The consensus among many attendees was that steel prices and availability were the only two elements currently restraining manufacturing.

Glen Kidd, director of market research for United States Steel Corp., identified growing demand for both steel and scrap as the main forces driving the prices upward. Current demand growth is due to two factors, according to Kidd. The first is the global economic upswing, and the second is the construction boom in China.

In a presentation on U.S. tube production capacity, Douglass Yadon of Preston Publishing Co. Inc. cited a global shortage of coke and iron ore and concurred that the current disruption in metallics supply is largely the result of demand from China. He referred to it as a supply disruption rather than a shortage. He predicted that the market would respond to the increased prices by increasing supply and that prices would drop during the second and third quarters of this year.

Other presentations focused on three main areas of interest in the tube and pipe industry—executive business issues, stainless steel topics, and technical management topics. Presentations included:

  • Lean Manufacturing & Six Sigma presented by Jerry Nelligan of Florida MEP.
  • Health Care Costs by Ed Young of Horton Insurance.
  • Constraint Management by Chet Kagel of HPK Group.
  • Legislation Affecting Manufacturing by Fred Nichols of the National Assn. of Manufacturers (NAM).
  • Choosing Lubricants, Coolants & Solvents by Patrick McFadden of Benchmark Metalworking Fluids.
  • Different Levels of Quality Control Inspection Equipment by Brian Roberts of Advanced Kiffer Systems Inc.
  • Draw Bench and Straightening Technology by Nelson Abbey III of Abbey International.
  • Fundamentals of Welding Stainless Steel Tubing With a Laser by David Havrilla and Stefan Ziesemer of Rofin-Sinar Laser GmbH.
  • Managing Tube Bending—Best Practices to Minimize Variation & Downtime by Tony Granelli of SWR America LLC.
  • Reducing Overall Costs on New Treatments of Tool Steels by Jim Jantzi of New Form Tools.
  • New Regulations—ISO & TS 16-949 by Jack Doherty of Florida MEP.
  • Reduced Setup Time/Quick Changeover by Tim Gaughan of T & H Lemont.
  • Advancements in Tube Fabrication by Keith Leuthold of Mazak Nissho Iwai Corp.