Ohio Steel Industry Advisory Council
December 1995
On
the Steel Front
Quarterly report text
Recycling roundup
Saving with steel
Steel at work
Steel Front sidebars
Legislative Lookout
PUCO move is small step Rust
Is Off The Belt,
Voinovich Asserts The Ohio
steel industry has made a dramatic recovery, regaining its international
competitiveness, Gov. George V. Voinovich says. "When
it comes to Ohio and the Great Lakes region, the rust is off the belt,"
Voinovich remarked at the Oct. 20 commissioning of Republic Engineered
Steels' new $165 million casting and rolling complex in Canton. "In many
respects, Republic's story parallels the tale of the entire American steel
industry, once practically written off as obsolete and extinct," Voinovich
said. "In the
United States - and Ohio - the steel industry has risen from the ashes
and reclaimed its place as a world leader in technology, quality and productivity.
That renewal has helped our state and our Great Lakes region regain the
competitive edge we had enjoyed earlier in this century." Republic's
ceremony was one of several this year that marked heavy re-investments
in Ohio steel facilities. Lt. Gov. Nancy Hollister was on hand when Wheeling-Pittsburgh
Steel Corp. and its Japanese and South Korean partners broke ground on
their $80 million Ohio Coatings Co. tinplating venture in Yorkville. Gov.
Voinovich also helped USS/KOBE Steel Co. dedicate its new bloom caster
and small bar mill and celebrate 100 years of steelmaking in Lorain. Voinovich
cites several statistics to support his assertions about steel's comeback
in the Buckeye State: - A Carnegie-Mellon
University study indicates that, if the Great Lakes region were a separate
nation, it would have the world's second-highest rate of productivity.
- One of every nine
steelmaking plants and one of every six jobs in the industry are located
in Ohio.
- In 1994, Ohio produced
16.6 million tons of raw steel, or 17 percent of all the steel produced
in the U.S.
- Almost $4.9 billion
worth of steel-related goods -18.9 percent of total U.S. production
- was generated by Ohio companies, more than any other state in the
nation.
Ohio steel companies
are committed to continuing to make the kinds of capital improvements
they need to remain competitive, Gov. Voinovich said. "It's estimated that
Ohio steelmakers will invest more than $650 million in capital improvements
during 1995, which will boost Ohio's economy and strengthen the industry's
global competitiveness," he said. "Unless you stay ahead
of the curve with advanced facilities like this (Republic's complex),
you'll be left behind in the global marketplace."
[back to top] OHIO
STEEL DATA REPORT:
Third Quarter 1995 Quarter
Ended September 30 Nine
Months Ended September 30 Item
1995 1994 % chg 1995 1994 % chg Steel
Production (tons) 4,233,317 4,292,208 -1 13,071,088 12,834,434 +2 Shipments
(tons) 3,297,992 3,430,973 -4 10,955,388 10,596,858 +3 Exports
(tons) 171,752 92,474 +86 285,216 153,774 +86 Payroll
$350,995,674 $348,087,364 +0.8 $1,125,315,015 $1,051,551,914 +7 Average
Employment 29,453 29,158 +1 29,464 29,270 +0.7 Capital
Investment Spending $142,092,253 $92,914,001 +53 $540,071,429 $239,235,899
+126 State
and Local Taxes $26,546,518 $25,979,987 +2 $76,733,645 $69,641,155 +10 Healthcare
Spending $64,648,827 $67,709,397 -5 $201,988,899 $200,677,720 +0.7
[back to top] 2nd
Ohio Appliance Recycling Round-up For the
second year, the Steel Recycling Institute and the Ohio Department of
Natural Resources are teaming up with Ohio steel, appliance and scrap
companies to sponsor the "Appliance Recycling Round-up," a statewide effort
to collect and recycle appliances. The Round-up,
slated for April 1996, is designed to promote recycling of the steel content
in household appliances, such as refrigerators, ranges and toasters. It
invites Ohio's solid waste management districts and municipal recycling
officials to help coordinate the collection and recycling of appliances. This
year, other household items containing steel - such as swing sets, pipes
and metal shelves - will also be rounded up and recycled. Last
year's Round-up netted more than 8,600 appliances for recycling. Additional
information on the Recycling Round-up is available from the Steel Recycling
Institute at (412) 922-2772
[back to top] Savings
with Steel An independent
research firm's analysis indicates the lightweight steel body would cost
about $154, or 14 percent, less to manufacture than conventional designs.
The savings would result from the innovative design, fewer parts and efficient
manufacturing. Item
Conventional Design UltraLight Design Vehicle
mass (kilograms) 271 205 Number
of body pieces 195 169 Body
cost* $1,116 $962 *Body
includes structure, roof and quarter panels. Source:
IBIS Associates, Wellesley, Mass.
[back to top] Ohio
Steel Companies Help Lead
Development of New Automotive Design Three
Ohio steel companies have joined an international coalition to develop
and validate new technologies for designing and manufacturing steel automobile
bodies. The new
technology, called the UltraLight Steel Auto Body, dramatically reduces
automobile weight, while improving safety and performance. The design
will ensure that steel remains the preferred material in future generations
of automobiles. This
fall, 32 steel companies from around the world - including AK Steel Corp.,
based in Middletown; LTV Steel Co., Cleveland; and WCI Steel, Inc., Warren
- pledged more than $20 million to the program. Other members of the coalition
include U.S. Steel Group and KOBE Steel Co., the owners of USS/KOBE Steel
Co., Lorain. The funds
will be used to develop a "body-in-white" structure to test the concept's
weight, manufacturability, rigidity, affordability and other performance
criteria. The body-in-white is the vehicle's skeletal structure, to which
other major components - such as the drivetrain and engine - are attached. Earlier
this year, researchers completed the design and engineering phase of the
UltraLight design project. Engineers project that the new technology will
reduce body structure weights by up to 35 percent, lowering manufacturing
cost by about 14 percent. The design
will improve torsional strength - the capacity to resist twisting - by
as much as 132 percent, compared with current vehicles of similar size. The steel
coalition expects the new design will help automobile manufacturers throughout
the world provide their customers with safer, more affordable, more environmentally
responsible vehicles that meet rising expectations for performance. The UltraLight
design will create energy and environmental benefits throughout the life
cycle of a vehicle, from steel mining to scrap metal recycling. Steel
is the most recycled material in the world - more than 95 percent of all
steel products are recycled. Because
of its relative lightness, the new design will require less material in
other components such as engines, suspension, brakes, tires and wheels. Coalition
members believe that the results of the UltraLight program will re-emphasize
the primary benefits of steel automotive components. These include low
cost, strength, manufacturing flexibility and ease of production. With
an unmatched ability to absorb crash energy, steel also has demonstrated
superior safety performance. The design
uses existing manufacturing technology to assure that the product can
be readily manufactured by industry today - without awaiting development
of "sci-fi" manufacturing systems.
[back to top] Steel
Front Sidebars AK Steel
Corp. and Armco Inc. were honored recently by the American Society for
Metals for their joint effort in developing a new aluminum-coated stainless
steel. AK Steel purchases the stainless steel from Armco and then coats
the steel with aluminum, primarily for automobile exhaust systems. Copperweld
Steel Co. has emerged from a Bankruptcy Court reorganization with a new
name, CSC Ltd., as well as new ownership. The Warren producer of SBQ bars
is owned by The Reserve Group, an Akron-based company that plans major
capital investments at CSC. The new company also signed a five-year technology
exchange agreement with Daido Steel of Japan. LTV Steel
will invest $20 million to build a state-of-the-art steel pickling line
at its Cleveland steelmaking complex. The new line will soak flat-rolled
steel in a solution that removes impurities from the steel's surface. WCI Steel,
Inc. plans to install a hydrogen anneal facility at its Warren plant.
Thehigh-temperature
furnaces will improve the metallurgical and magnetic properties of WCI's
non-oriented silicon steels. Silicon steels are used in the production
of electrical equipment such as motors, generators and transformers. The Timken
Company, based in Canton, has introduced a steelmaking process that will
help improve the performance and lower the cost of many goods made from
steel. Timken's AdvanTecT employs a new pre-heat-treat process to make
steel used in auto transmissions, gears, bearings and other components
more resistant to cracking.
[back to top] Steel
Producers Back Managed Care Representatives
of two Ohio steel producers recently urged state lawmakers to support
the use of managed care in reducing the cost and improving the quality
of employees' health care. Barry
Martin, healthcare planning and administration manager at The Timken Company,
and Charles Gearhart, manager of insurance benefit planning for LTV Steel
Co., were among several industry representatives who spoke in favor of
maintaining a free-market healthcare system and against a measure that
would require managed care networks to accept any physician willing to
participate. A mandate to accept any willing provider would impede managed
care companies' ability to build networks of the best and most cost-effective
physicians. The measure
remained in the House Health, Retirement and Aging Committee as the Legislature
adjourned in November. "With
the kind of quality and cost results we and our colleagues throughout
industry are achieving - while maintaining associates' choice of providers
- we do not think it is necessary to legislate physician access to managed
care organizations or to legislate patient choice," Martin told the House
committee. "In fact,"
he added, "we think the Legislature should not consider any legislation
which will adversely impact fair competition in the marketplace." The Legislature
is also considering the creation of a state-maintained managed care system.
Gearhart told the Senate Health Committee that a well-designed, patient-friendly
managed care program would be an effective solution for the public sector. "The
advantages we have received can certainly be duplicated by the State of
Ohio," Gearhart said. "There is no question that if we can have an impact
on the lifestyle and health of the LTV family, the state can have an even
larger impact on the cost and quality of care delivered in Ohio by moving
toward managed care for its constituencies." Gearhart
credited managed care with helping LTV control its healthcare costs. "Combined
with fewer covered lives, managed care led to an overall healthcare cost
reduction in 1993," Gearhart said. "I'm
very proud to say that in the two-and-a-half years that we have been offering
managed care benefits to our employees and retirees, the plan has been
well received and there have been very few complaints," he added. "We
have received many very encouraging reports that members are satisfied
with the benefits and quality of care they receive."
[back to top] Steel
Producers See PUCO Move as Small
Step Toward Competition Among Electric Utilities Ohio
steel producers - the Buckeye State's largest group of electricity purchasers
- welcome a new initiative by the Public Utilities Commission of Ohio
as a small but important first step in the move toward competition among
electric utilities. The PUCO
is drafting a new policy that will for the first time allow large electricity
users to buy power directly from an alternate supplier during peak demand
periods when the local electric utility cannot supply power. Currently,
power supplied during such periods is procured and delivered by the local
utility. "Although
this new policy is a long way from the free-market competition we're looking
for, this at least sets an important precedent by giving us the opportunity
to buy power on our own," said Martin Suhoza, chairman of the Ohio Steel
Industry Advisory Commission's energy subcommittee and director of energy
management and production materials for LTV Steel, Cleveland. The PUCO
has indicated it hoped to have the new policy in place by early next year. Having
spent more than $300 million on electricity in 1993, the last year for
which figures were available, Ohio steel producers view the policy in
the context of staying competitive in a global economy. Other countries
have restructured their utilities, and several other U.S. states have
made major changes to encourage competition. "It is
becoming increasingly difficult to remain competitive in a global market
without the ability to negotiate power rates the way we negotiate for
other services," Suhoza said. "We need the right to choose suppliers based
on quality, price and service, just like our customers choose their steel
suppliers. "So the
PUCO's initiative is a step in the right direction. But we need to take
bigger steps."
[back to top] | 
