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CITAC STEEL CONSUMERS SEE LOOMING DANGER FROM COMPETING PRODUCTS

Rep. Donald Manzullo (R-IL) hears from Illinois companies

Rockford, IL - Members of the CITAC Steel Task Force met yesterday with the Chairman of the Small Business Committee Donald Manzullo in his district office in Rockford, IL to detail the serious and growing crisis they face as a result of the 201 tariff on steel imports.

"I am still hearing about serious steel supply shortages and price gouging by the domestic steel industry that is hurting steel-using manufacturers. Recently, though, the message from constituent manufacturers is that their foreign competitors are taking advantage of the situation created by the 201 tariff regime by importing competing steel-containing products," stated Chairman Manzullo. "Our own government is inviting foreign manufacturers - from China, South America, Europe - to export products to the U.S. because the steel tariff makes American manufacturers uncompetitive."

Steel users at today's meeting included representatives of Olson International of Lombard, IL; and Parkview Metal Products, Chicago, IL, both members of the Precision Metalforming Association, as well as Rockford Fastener, Inc. of Rockford, IL, a member of the Industrial Fastener Institute; Metalforming Technologies, Inc., Chicago, IL, a member of Motor and Equipment Manufacturers Association and Domeny Tool & Stamping Company of Wauconda, IL. Each company submitted a letter to the Chairman, documenting inadequate supply, price gouging and competitive threats that they are experiencing.

Edward Farrer, Manager of Purchasing for Olson International, wrote in his letter to Chairman Manzullo, "The U.S. now has the highest steel price in the world. Our customers are international and they are sourcing more work in Asia and Europe where metal prices are more than $120 per ton less than what we can obtain in the U.S."

Margaret Domeny, President of Domeny Tool and Stamping Company said her company has attended a number of auctions of small manufacturers. She estimates 30% of metal stampers are out of business and each week she receives more notices of upcoming auctions. "How shortsighted is our government? If we lose manufacturing, we won't need steel at any price," she wrote.

Metalforming Technologies, Inc (MTI) was represented at the meeting by President and CEO Richard D. McClain. In his letter to Rep. Manzullo, he noted that his company has seen contracts broken by service centers who presented MTI with "data indicating that the domestic mills have increased prices by as much as 90% since January, with additional price increases imminent." For MTI, which supplies the automotive industry, the shortages and delivery delays threaten more than the company. "With the lean, just-in-time nature of the automotive supply chain, such a shortfall by any sub-supplier can very quickly result in interrupted vehicle assembly operations and a ripple effect of shutdowns throughout the industry."

Donald Mayo, Vice President of Operations for Parkview Metal Products, faces the same problems as his peers and sees more bad news in the future. "The already bleak situation could worsen with the August 26 International Trade Commission ruling on cold-rolled 'dumping' suits. Though order books are full…the domestics are attempting to secure additional duties of up to 150% on cold-rolled steel imports from 20 countries!"

Chairman Manzullo has taken the plight of steel users to the highest levels. In June, Rep. Manzullo provided Secretary Evans with messages from more than 100 steel-consuming companies in Illinois and other states who have written to Manzullo about the negative consequences of the 201 tariffs. Manzullo has taken the letters, and hundreds more that continue to come in to his office, to the Office of the U.S. Trade Representative and other officials. In addition, he invited small steel-using manufacturers to appear before the House Committee on Small Business on July 23 and has asked the Justice Department to look into price gouging that may be taking place as domestic steel prices continue to rise. In addition to six companies who testified on July 23, many more have presented written statements to the Committee.

Margaret Domeny concluded her letter with the message that she hopes to get through to lawmakers not taking the steel tariff as seriously as Representative Manzullo - "thousands of manufacturing employees have lost their jobs, but not their votes!"

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of American firms.