NEW YORK While the U.S.
construction market is unlikely to see a sudden rebound, steel
producers are seeing spikes in demand from the automotive and
transportation sectors, as well as the energy and exploration
industries, a panel of industry executives said at AISTech
2012, the Iron and Steel Technology Conference and Exposition
"Its good news for our
steel industry that the auto industry is recovering very well,
at a very solid pace," Michael S. Williams, senior vice
president of North American flat-rolled operations at
Pittsburgh-based U.S. Steel Corp., said during the AISTech Town
The U.S. automotive
sectors rebound has surpassed expectations, according to
Dieter Hoeppli, managing director of New York-based Deutsche
Bank Securities Inc.s natural resources group.
The pickup has been "a bright
spot for the (steel) industry," he said. "It has been bouncing
back much faster than expected."
But the growth goes beyond the
automotive sector, with the transportation market at large
booming, the panel agreed.
according to André B. Gerdau Johannpeter, chief
executive officer of Porto Alegre, Brazil-based Gerdau SA.
"Bus, underground rail, ships or whatever . . .
its broader than (simply owning) your own car."
The other executives agreed.
"The rail transportation
business is looking attractive in the medium-term," P.S.
Venkataramanan, chief executive officer of Luxembourg-based
ArcelorMittals Long Carbon North America operations,
said. "I think rail is proving to be one of the cheaper forms
In addition to transportation,
the energy and exploration industriesand their
suppliershave been doing well, the executives said,
citing investments companies have recently made catering to the
natural gas industry.
"Any increase in this
exploration for natural gas will help the construction market,"
according to David Sumoski, vice president and general manager
of Charlotte, N.C.-based Nucor Corp.s Marion, Ohio, steel
mill. "Were very focused on that market."
And the natural gas boom
doesnt simply benefit domestic steel producers by
reducing costs (AMM, May 10). The oil country tubular
goods (OCTG) market is also a major steel consumer.
"Were a big player in the
energy market in the sense that we supply a lot of steel to
OCTG market," Venkataramanan said, noting increased activity at
drilling platforms and the strength of the mining sector
The exploration boom has also
led to an increase in demand from equipment manufacturers, the
"If you look at equipment
manufacturers like Caterpillar, theyre extremely
successful," Christian Dohr, president and chief executive
officer of Calvert, Ala.-based ThyssenKrupp Steel USA LLC,
said. "Energy and exploration is a key worldwide."