The fortunes of the U.S. automotive and housing markets don't bode well for the aluminized sheet industry in the short term, according to service center sources who buy large amounts of the product.
"How is the aluminized sheet market going? Let me put it this way it's a good thing we're in stainless," said one service center source handling both aluminized sheet and stainless steels.
Joe Block, vice president of Block Steel Corp., Skokie, Ill., agreed with the assessment. "Generally speaking, the market for aluminized sheet products is fairly depressed," he said. "It's tied a great deal to consumer products--things such as home appliances, where you need heat resistance--and it's also tied to the automotive exhaust market."
Both of those markets are down these days, and service centers are seeing little in the way of demand for aluminized sheet thanks to the sagging housing market in the United States and less-than-robust automotive sales.
Prices for aluminized sheet vary with coating weights, but sources pegged the range at $38 to $40 per hundredweight ($760 to $800 a ton). The price of aluminum has little impact on the overall price of aluminized sheet, since so little of the material (91-percent aluminum and 9-percent silicon) is actually applied (generally via a hot-dip process) to the steel substrate, they said.
"We haven't seen an aluminum surcharge on any aluminized sheet. Zinc will affect the price on hot-dip galvanized, but you really don't see (aluminum costs) having much impact on aluminized sheet," one Midwest service center source said. "We're selling some in small volumes for things like cookware and barbecue grills. We're seeing some activity there. I would say that business has been good, but it's kind of a small niche market. Some of the other areas aren't doing as well."
The three U.S. manufacturers of aluminized sheet--ArcelorMittal, Chicago; AK Steel Corp., West Chester, Ohio; and Wheeling-Nisshin Inc., Wheeling, W.Va.--serve a market that consumes somewhere between 700,000 and 780,000 tons of the material annually.
The market was enjoying regular growth about 10 years ago, but it has stabilized during the last three or four years, Block said. "There are strong and weak points to the market. One of the things that we have lost over the last several years are the picture tubes that went into television sets. Now with all the LCD (liquid crystal displays) and plasma TVs, the tube TVs have gone by the wayside.
"Overall, I would say the market is steady, but down a little bit because a lot of OEMs (original equipment manufacturers) have shifted to more use of stainless steels for things like (automotive) fuel tanks. We're also looking at the possibility that the use of stainless could trickle to the after-market. We're starting to see some signs of that going on right now."