It appears the oil market isn’t the only industry facing deep repercussions from overcapacity. The U.S. steel industry will likely face two other major headwinds in the second half of 2015: falling prices and foreign steel dumping, according to trade credit insurer forecast.
Euler Hermes expects 2015 steel prices to decline by 18% and annual production to decrease by 3-4%, primarily due to oversupply. Though construction, machinery and equipment, and automotive companies will benefit from lower prices for material over the next six to 12 months, Euler Hermes suggests extending credit to buyers in steel producing and services sectors with caution. Volatile prices and annual production levels have increased market uncertainty, and the firm predicts corporate consolidations and bankruptcies are in the near future.
Meanwhile, as part of an effort to address some domestic industry headwinds, six U.S.-based producers recently filed antidumping and countervailing duty petitions related to hot-rolled steel from more than a half-dozen nations allegedly receiving unfair subsides.
- Diana Mota, NACM associate editor
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