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US wire industry faces import pressure

Keywords: Tags  Wire rod, steel wire, steel wire rod, Walt Robertson, Johnstown Wire Technologies, John Martin III, Mar-Mac Wire, wire imports Samuel Frizell

NEW YORK — The domestic steel wire industry has been hemorrhaging money for years due to imports, but the losses are difficult to quantify because there is no reliable way to track many imported products that contain steel wire, according to Johnstown Wire Technologies Inc. president Walt Robertson.

U.S. steel wire and wire rod production has declined because downstream products made of steel wire—such as barbecue grills, fans and toasters—are increasingly manufactured overseas, particularly in China, Robertson said. But the extent of those imports can’t accurately be measured.

It’s a complaint that many in the steel wire industry have expressed to AMM, with executives at a range of major U.S. wire fabricators saying that they have seen their customer bases fold under pressure from Chinese products.

"Why is our industry seemingly under such pressure? What’s wrong with this picture?" Robertson asked. "There’s a whole piece of this that has just taken the bloom off the rose, and taken so much volume away from the rod mills and the downstream wire producers. Their businesses are just a shadow of what they used to be."

Products with steel wire that are manufactured overseas and shipped to the United States—a fan with a steel wire grill, for example—contain wire that has been drawn overseas, and that wire has been drawn from wire rod that also has been produced overseas, Robertson said. The result is that businesses at every point on the supply chain is hurt when a finished product is imported.

Robertson said that his own business has felt the squeeze from imported products. The Johnstown, Pa.-based company "used to make thousands of tons a month of wool wire," he said. "We sold to people in the United States that made steel fibers. That market was 40,000 tons a year. Today, we produce a small fraction of that. ... We have lost the business specifically to imported steel fibers from China. We used to do 150,000 tons (of total wire a year). We’re doing 120,000 tons now."

Several other sources who asked not to be named confirmed that production has been declining over the past few years due to imports.

"(We had an) upwards-of-35,000-ton wire mill that is now not being consumed (in the United States) because the wire grill, as well as the wire grate, is now produced in China," a source at a southern wire drawer said, adding that he had seen facilities close because of imports.

The wire industry has not found a way to track the wire content of imported manufactured products, so it’s nearly impossible to judge exactly how much business is being lost. In order to get accurate figures, it would be necessary to calculate the total amount of wire used in every imported finished product as a portion of its total weight—a gargantuan task considering the number of products which use wire.

"When you look at the total industry in the United States, the fan grills aren’t coming as fan grills; they’re coming as fans," John Martin III, chief executive officer of McBee, S.C.-based wire drawer Mar-Mac Wire Inc., said. "Ovens are being imported and the oven racks are no longer made here. That’s not in the rod statistics because they’re coming in as appliances. There’d have to be a complex calculation and extensive data if you’re trying to hold on to what’s happening."

Robertson has gathered some data in an attempt to measure what the industry has lost. According to data he compiled from the American Iron and Steel Institute and U.S. rod mills, 10.5 million tons of steel wire, wire rod and wire products were consumed in the United States in 2012, down from 12.7 million tons in 2000. Robertson believes that the missing tons can be traced to imported downstream products that incorporate steel wire.

"Either the United States is consuming less of all these things—markedly less of all the stuff that’s made of rod and wire—or somehow we can’t capture (the data of) what’s being consumed," Robertson said. "Looking at how robust the market was and looking at it today, my heart goes out to these guys. I’m not sure what to do."

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