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Steel founders look cautiously toward the '90s.

Steel Founders Look Cautiously Toward the '90s

After surviving depression-like business conditions for much of the 1980s, U.S. steel foundries have seen their fortunes take a turn for the better since 1987. But the bitter lessons of the early '80s have left foundry executives looking cautiously toward the 1990s.

In his opening remarks to this year's annual meeting of the Steel Founders' Society of America, SFSA president Jack Beyersdorfer set the tone for the Society and industry in general, when he said, "We've made significant progress in recent years, but the future remains uncertain." And the future was clearly the focus of the meeting, held Sep 17-20 in Savannah, GA.

Outlook and Outcome

The industry's performance in 1989 and forecast for 1990 were summarized by Duke DeLong, Delray Steel Casting, and chairman of the SFSA marketing committee.

In reviewing the past year, DeLong characterized it as: "A good year, so far. Production levels have been adequate to return many foundries to profitable operation. In spite of spot shortages of materials and a more chronic shortage of willing and trained workers, casting suppliers have kept pace with demand and backlogs have not become excessive."

He also pointed to the downside of the steel foundry's improving business conditions: "As production levels have risen, inexperienced workers and tighter quality requirements have led to increases in scrap rates with some loss of profit. Also, promotions of experienced technical people, along with the lack of new employees for the last five years, has led to a shortage of technically trained metallurgists, quality control and melting supervisors."

An examination by the SFSA marketing committee shows that each major steel castings market--railroad, mining, construction equipment, motor vehicle, ordinance and military, valves, pumps and dies--experienced healthy increases ranging from 6-12% in 1989.

In contrast, the committee's forecast for 1990 is cautious compared with 1989. Of the nine markets cited in the report, two are projected to decline 3-8%, one is projected to remain the same, while the others are expected to rise 3-10%. Overall, the committee is projecting a 3% increase for steel castings in the coming year.

Summarizing the present and projected situation of steel foundries, DeLong said, "We feel 1990 will continue 1989's growth cycle, albeit not as pronounced, but the increase is still to be seen."

Marketing Castings

Steel foundry executives attending this year's meeting also were given a look at a program developed by several companies to market ductile iron. Tom Gibson, Miller and Co, described the work of the Ductile Iron Group that has been initiated to determine the needs of materials engineers, discover their perceptions of castings and to educate them on the benefits of using ductile iron.

The same type of program could be developed to promote the use of steel castings, according to Gibson. The four point program outlined by Gibson includes:

* consider the needs and wants of purchasing, manufacturing and the design engineer;

* emphasize the cost effectiveness and availability, plus the technical benefits to specific target industries;

* identify niches where weldability, impact resistance, modulus of rigidity and modulus of elasticity are important;

* allocate considerable resources into technical literature. Ensure technical competence and support of sales representatives, and maximize the technical content of advertising.

The Washington Scene

Legislation from Washington, D.C. increasingly is playing a role in the way foundries conduct their businesses. Walter Kiplinger, American Cast Metals Assn, focused on three programs with direct implications for the industry: foundry research and development funding; clear air; and beneficial reuse of foundry sand.

Two bills, one in the House (H.R. 1243) and the other in the Senate (S.R. 775), propose the establishment of regional metalcasting centers to conduct R&D and engineering programs to increase the competitiveness and profitability of the American cast metals industry.

Kiplinger urged industry support for the bills by pointing out the "widespread national assistance for foundries throughout Europe and the United Kingdom, and the Far East."

On clean air legislation, he said, "Revisions to the Clean Air Act that was enacted in 1970 and amended in 1977 now have the best prospect for passage in eight years." President Bush in June introduced a comprehensive bill that is likely to become the lead measure among six others being worked on in Congress.

"Of most concern to foundries will be the stationary source air toxics section," Kiplinger said. A key provision in the bill requires any source emitting more than ten tons a year of one air toxic, or a combined total of 25 tons, to be classified as a "major source" and subject to regulation.

Kiplinger also described several programs that may allow the reuse of foundry sand. For example, he said: "EPA is now investigating the feasibility of establishing guidelines for foundry sand for use in concrete and construction projects. If it is a suitable candidate, EPA will develop a procurement guideline. Procurement guidelines require federal agencies, and state and local governments that are spending federal funds, to procure a specifically designated item, in this case foundry sand."
COPYRIGHT 1989 American Foundry Society, Inc.
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Copyright 1989, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Steel Founders' Society of America meeting
Author:Kanicki, David P.
Publication:Modern Casting
Date:Nov 1, 1989
Previous Article:DIS conference looks at shrinkage, hardness.
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