It's a small niche market, but with more than
a ton of stainless steel in every restaurant kitchen in the
nation it's not one to be treated lightly.
Steel producers are paying close attention to
the sector, which is driving them to create specialized
material. While Type 304 stainless has long been the industry
standard for use in commercial kitchens, producers say they've
recently started making other grades to sell into that
Allegheny Technologies Inc. (ATI),
Pittsburgh, produces material for the food equipment and
appliances market from its flat-rolled stainless division.
While Dan Greenfield, ATI's vice president of investor
relations, declined to quantify the sector because it's "a
small part of the business," he did say the company is selling
more alternative grades for culinary uses.
"The big story from the Allegheny side is the
continual growth in the use of our 201HP and other
low-nickel-bearing alloys," Greenfield said. "They're using
more less-expensive material." Type 201 stainless has half the
nickel content of Type 304 product, and therefore a lower price
Likewise, stainless made by Taiwan-based Ta
Chen International Inc. makes its way through its
distributorship into the hands of restaurateurs.
John Hellinghausen, vice president of Ta
Chen's Long Beach, Calif., office, said the company doesn't
sell any products directly to the food service industry.
Rather, he said, it sells to service centers who in turn
service the market.
Regardless of the downturn in the economy,
sales into the restaurant kitchen market remain strong,
Hellinghausen said. "Market demand is still fairly strong and
this is despite our publicized recession. The geographic areas
performing the best are the Midwest and the Southwest."
Hellinghausen echoed ATI's comments on alloy
substitution. "Stemming from last summer's nickel price surge,
many requirements have shifted from a 304 stainless to 301, 430
and 201, where permissible," he said. "Response outlook in this
market segment continues to be positive."
The same holds true at Outokumpu Oyj. The
Espoo, Finland-based stainless producer, which has processing
and distribution capabilities in North America, said it has
been prompted to do more manufacturing of non-traditional
stainless material because customers are seeking less-expensive
Chuck Turack, Outokumpu's vice president and
general manager of sales and marketing for the company's North
American business, said the company is undergoing a three-year
capital expansion program to produce more ferritic material,
which primarily consists of the 400-series grade that contains
"The primary driver for us in ferritics is to
be able to supply the food service equipment, or as we call
catering," Turack said. "We put together a team of commercial
people who did extensive market analysis to pull information
from resources about going to ferritics." Also to that end,
Outokumpu markets a special finish for its stainless material
specifically for use by the restaurant industry. The company
said its HyClean SuperBrush stainless has a smooth and
corrosion-resistant finish that creates less potential for
contamination in hygiene-critical settings like food production
Turack sees the restaurant kitchen market as
a growing one, not only in North America but also worldwide.
"Certainly on a global basis, because of the expanding middle
class globally, this segment will continue to grow, probably
slightly above the overall average," he said.