Dip in mechanical tube demand dampens growth forecast

Sep 30, 2012 | 07:00 PM | Myra Pinkham

Tags  mechanical tube, seamless tube, steel tube, steel pipe, automotive market, heavy equipment sales, natural gas market, Paul Vivian Shawn Seanor

Growth in the U.S. mechanical tubing market has flattened out somewhat this year and is expected to remain so for the next year or so unless the domestic or global economies pick up unexpectedly.

“There hasn’t been a big downturn. Rather, the mechanical tubing market is likely to be flat to slightly down for the rest of the year” in light of the slowing of general manufacturing activity since April and May through at least summer, according to Paul Vivian, a partner at Preston Pipe Report, Ballwin, Mo.

Mechanical tubing, especially seamless product, was on track to have a very good year, at least through the first half, said Shawn Seanor, vice president of oil and gas engineered steel solutions at Canton, Ohio-based Timken Co. That, however, has been somewhat impacted by certain “headwinds” that started to develop in the second half.

Despite this, demand isn’t bad and has flattened out at a pretty good level, said Bill Jones, vice chairman of O’Neal Industries Inc., Birmingham, Ala.

That isn’t that surprising, according to William A. Wolfe, executive director of the Steel Tube Institute of North America, noting that mechanical tubing’s use in some of the stronger end-use sectors, like automotive, heavy equipment, and oil and natural gas, has helped prop up demand.

It just isn’t the same “super strong” market as it was last year, when many tube mills had their customers on allocation or controlled order entry, according to Tim Spatafore, president of Marmon/Keystone LLC, Butler, Pa. ....