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Don't scrap the issue: the points and counterpoints of government intervention.

In the midst of the ferrous scrap dilemma of high prices and distressed metalcasters, a pendulum is being pulled from both sides.

The Emergency Steel Scrap Coalition and the Institute of Scrap Recycling Industries Inc. (ISRI) are currently fighting each other to draw the government in their direction. The issue what actions should Congress and the Bush Administration take in handling the increased domestic scrap prices in lieu of global exports.

Even though the situation is said to affect thousands of workers in iron and steel industries, a distinct dividing line exists that separates opinion. The Coalition feels due to the inflated domestic costs resulting from high volumes of exported scrap, the government needs to impose limits on scrap exports and help reduce suppliers' surcharges. It believes this would alleviate a burden on domestic users of scrap and help rejuvenate their businesses. Similar controls (tariffs on exported scrap) were carried through between 1973 and 1974.

On the contrary, ISRI considers the current situation as simply a point in a highly-cyclical scrap market that will revolve with time, and no controls need to be enforced. Several sources have mentioned that price escalations are due to the laws of supply and demand The price will increase due to the higher demand, and the steel market may appear to be rampant for a while.

Inside This Story:

* A dispute has erupted between scrap handlers and scrap users as to whether there should be export controls on ferrous scrap supplies.

* This article details both sides of the dispute and what action is being taken.

For more information

Visit the Emergency Steel Scrap Coalition web site at www.scrapemergency.com

Visit the Institute of Scrap Recycling Industries Inc. web site at www.isri.org
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Article Details
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Author:O'Shaughnessy, Kevin
Publication:Modern Casting
Article Type:Cover Story
Date:Apr 1, 2004
Words:289
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