Marketplace Radio’s John Dimsdale ran a piece yesterday that noted the resurgence of the steel industry, with rising prices helping both domestic and international steel companies to renewed profits.  Dimsdale noted that a “cheap dollar and overseas demand are pumping new life into an old, domestic industry.”

  It’s only recently, though, that the steel industry has seen a turnaround from all its difficulties.  Dimsdale interviewed AAM director Scott Paul, who noted that there’s been roughly “18 months of prosperity for steel, but that comes on the back of about three decades of bloodletting.”

U.S. steel manufacturers have seen rough times in the past two decades, in large part because of subsidized competition from overseas.  China has boosted steel production exponentially in recent years, in large part due to energy subsidies for its steel producers. 

And while U.S. steel producers may continue to earn profits in the near future, Scott Paul remarked to Dimsdale that competition from China is also growing: “China has brought on about 400 million metric tons of new steel capacity just over the last couple of years. And if there is a worldwide economic downturn and demand in China and other countries decreases, we’re gonna see a glut of overcapacity.”

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This entry was posted on Saturday, May 17th, 2008 at 5:42 am and is filed under Manufacturing in the U.S., AAM. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.