DEARBORN, Mich. Market
demand for galvanized products in the United States will not
need a kickstart or new capacity until the construction market
While executives of steel
coating companies expressed greater confidence in other markets
using galvanized products, they continue to view the
construction industry as depressed and cant predict when
it will rebound.
"Two months do not a trend
make," one participant said at AMMs Galvanized
and Coated Steel Conference in Dearborn, Mich., referring to
such indicators as the Architectural Billings Index, which rose
"I believe 20 percent of all
mortgages are under water," Jerry Richardson, general manager
of Terre Haute, Ind.-based CSN LLC, said in referring to
homeowners who owe more than their homes current
appraised value. CSN is a subsidiary of Brazilian steelmaker
Cia. Siderúrgica Nacional.
Previous efforts to get more
single-family residential properties built with steel framing
rather than wood have hit roadblocks: Standards for steel
framing havent been written into local building codes
"and construction is always a local market," and because
building contractors arent familiar with using a screw
gun to attach studs instead of using a hammer and nails,
according to Frank Goodwin, director of technology and market
development at the International Zinc Association.
"Residential steel framing never
went above 10 percent of any market," even in states that wrote
mandates on hurricane-resistant products into their building
codes, Richardson said. "I dont see it climbing to more
than 5 percent of the market."
Goodwin agreed. "There are
people marketing it, but they have barely scratched the
surface," he said.
That hasnt prevented
steelmakers and coating suppliers from looking toward the
"You want to be the low-cost
provider in every market you serve," Thomas M. Marchak, vice
president of commercial for Dearborn, Mich.-based steelmaker
Severstal North America Inc., said.
Severstal NA parent company OAO
Severstal, Moscow, is exploring the installation of
color-coating lines in Russia, Marchak said, adding that OAO
Severstal chief executive officer Alexei Mordashov is also
interested in installing color-coating lines at Severstal
Columbus LLC in Mississippi and at Dearborn.
But until construction activity
begins growing substantially, "there is overcapacity," Marchak
Richardson agreed that, given
the right conditions, "it makes sense to incorporate paint
lines" into galvanizing operations.
Companies also want to be able
to improve the quality proposition. "Exposed automotive quality
is like making jewelry. You have to be on it all the time,"
Randall Brent, director of
product management at PPG Industrial Coatings, said products
must be long-lasting. "We have 20- to 30-year warranties on
roofing" made with coated steel, he said.
In the near term, "The effort to
reduce carbon dioxide emissions is a driver of innovation, and
innovation has to focus on sustainability," Brent said.
Goodwin concurs. "We have the
studies on life-cycle analysis," he said. "Sustainability must
be part of our strategy."