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Reaching an Equilibrium

Alfred Spada

What does the future hold for our industry?

At a recent conference for the metallurgical coke supply chain, this question was posed when discussing the U.S. steel market. Due to a down economy and global supply pressures, this market is facing significant business turmoil and at a crossroads to determine what and where its future will be.

During my presentation to this conference’s attendees about the state of the metalcasting industry, I referenced the crossroads our industry faced in 2008-2010 when the future of U.S. metalcasting was uncertain. My message to the attendees was to look where the metalcasting industry is today, only a handful of years after its crossroads, as it may be the envy of all other metalcasting markets across the globe.

Sure, U.S. production in several non-automotive markets is down significantly right now. Some segments of our production are operating at 50-60% of capacity while others are operating at 85-90%. But an equilibrium is beginning to be achieved in our supply chain. Not everything is moving offshore (as it seemed 10 years ago) nor is everything being sourced domestically—a balance is being sought in hopes of securing business success across the supply chain.

Look at some of the recent headlines:

  • Sakthi Breaks Ground on a $31.8 Million Casting Expansion in Michigan
  • Georg Fischer and Linamar Agree to Build a  Metalcasting Facility in the Southeast U.S.
  • Kamtek to Invest $80 million in a New Diecasting Facility in Alabama
  • Warren Buffet’s Berkshire Hathaway Purchases Precision Castparts for $37 Billion

These headlines show investment and continued global interest in the U.S metalcasting supply chain. Our feature, “Anderson Industries Takes New Track With Iron Castings,” on p. 30, details a casting buyer’s move to diversify its capabilities and customer base by acquiring a U.S. metalcaster.

“What initially interested me in buying Dakota Foundry was how it could broaden our services to customers on both sides,” said Kory Anderson, president of Anderson Industries. “We could, as one company, offer so many solutions, whether it’s iron or steel.”

This renewed interest is a great turnaround for our industry.

Yes, irrational sourcing decisions still are being made by casting buyers every day. These will always continue no matter the level of information and education you provide your customers.  Just continue to focus your marketing and sales efforts to insulate your business as best as possible by diversifying your customer base and the end-use markets you serve.

The future for metalcasting is full of possibilities. The key is the ability of metalcasters to take advantage of them.