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Shifting demands alter casting outlook for 1993-94.

Changing economic conditions and environmental factors throughout the world have resulted in both upward and downward revisions in the demand for metal castings.

The continued recession in some European and Asian countries has resulted in the loss of casting export markets for producers in the U.S. Though currency exchange rates have remained fairly stable in some countries, others have plummeted, causing the dollar to strengthen considerably, making U.S. casting prices less attractive.

U.S. farm equipment sales continue downward and decreases in defense spending are affecting aircraft and other industries. However, other industries are recovering from the recession and these markets are increasing their demand for castings as previously forecasted.

As an ongoing service for its clients and AFS corporate members, Stratecasts constantly surveys the marketplace and analyzes these rapid shifts. The following update of an earlier forecast takes these changes into consideration and their effect on casting shipments.

Changing Demands

While the forecast for metal castings during 1993 and into '94 remains bullish in most market segments, some reductions in demand are expected, primarily due to a re-evaluation of the passenger car and light truck markets. In addition, significant demand reductions in the aircraft industry as well as in other industries affected by defense spending can also be expected.

An updated look at trends in individual market segments is discussed in Table 1, which shows actual and forecast tonnages for 1992-93 and 1994, as well as a reforecast for the remainder of 1993.

* Metal castings used in valves, fittings, engines, construction and mining equipment, printing and plastic machinery, pumps, compressors, motor vehicles and railroad parts are forecasted to have excellent short-term growth into 1994.

* Castings used in farm machinery, paper machinery, oil field equipment and for aircraft parts are forecasted to decline throughout 1993.

* Weakening of European currencies is causing a reduction in casting exports in 1993 from expected levels.

* Aluminum automotive castings are forecasted to grow at a rate of 3.3% per year to 2002. The acceptance of aluminum and aluminum composites as safety and brake part materials may accelerate this growth.

* Special niche markets that present good growth potential include:

* corrosion-resistant steel valves and pumps;

* aluminum automotive cylinder heads;

* ductile iron for medium to heavy truck parts;

* ductile iron cope and drag parts for printing machines, truck and construction components;

* abrasion-resistant iron castings;

* diesel engine castings.


U.S. Metalcasting Capacity to Peak at 76% in 1993

Following is the forecasted casting capacity and use for 1993.
U.S. Casting Capacity and Use
 Capacity Use
 (000s tons) (%)
Iron 13,300 76
Steel 1,600 74
Aluminum 1,940 81
Copper-base 400 78
Magnesium 50 74
Zinc-base 410 80
Other Nonferrous 70 63
Investment Castings 210 79
Total Metal Castings 17,980 76
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Article Details
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Author:Kirgin, Kenneth H.
Publication:Modern Casting
Article Type:Industry Overview
Date:Jun 1, 1993
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