Workin’ On the Railroad: Domestic Steel Production Increasing

Planes, trains, and automobiles: familiar trappings of holiday travelers around this time of year. A steel plant in Pueblo, CO, is benefitting from the continuing growth of at least one of those ever-enjoyable travel methods: with the need for head-hardened steel used in laying rails expanding, the facility will be stepping up its production in 2012. This growth in investment will be accompanied by further efforts to produce higher-quality rail steel, capable of handling the heavy-duty demands of railcar coal transport in addition to travel and commuter rail.

Our work here at Keats Manufacturing is a bit removed from high-impact rail construction, but the repercussions in the industry at large are apparent. Our products do, of course, involve steel, and we’ve seen a number of commodity suppliers come and go over the past few years, in the face of waning production and a difficult economic climate. An investment of this caliber by any raw material producer is a sure sign of strength in the larger manufacturing world – and we also applaud the continued innovation in an industry as well-established as steel production.

Nucor’s Forecast Sheds Light on Manufacturing

This NASDAQ report on Nucor’s 4th quarter forecast – expecting year-over-year growth from Q4 2010, but a decline from Q3 numbers – also discusses how the steel manufacturer’s strengths and weaknesses play into the manufacturing market and industry. Of course, like any commodity, pricing of Nucor’s products – sheet steel, rolled steel, and so on – and subsequent profit or loss, is tied directly to the performance of those companies that purchase these materials.

Core U.S. manufacturing sectors like automotive, energy, and heavy equipment have, according to Nucor, been stronger this year than last. Obviously, this is great news, with the only minor downside being that an especially strong early 2011 means that a downward trend was shown for the year as a whole. Especially in this still-uncertain economic climate, such ups and downs are to be expected, and we see a positive outlook in the fact that this year’s lows are higher than last year’s lows – and, in some cases, are even better than previous highs. Also something to look forward to: a renewed burst of raw material purchasing as budgets are replenished in January, promising another early-year boom for 2012. Keep in touch with Keats for more information moving forward!

New Stamping Press Has Immediate Benefits

It’s one of those everyday parts of life that you never really notice – until it’s not there. Sure, this could apply to lots of things: your shoelaces, for one, or your cell phone, for another. What we’re talking about today, though, is the overhead dome light in your car. It sure can be jarring to pull open your driver’s side door at night, expecting to duck into a well-illuminated interior, only to be met with the same pitch-blackness that you’re standing in. Dome lights have been on our minds more than usual here at Keats, though, since we’ve been using a brand new piece of equipment specifically to manufacture dome light components for one of our partners.

With such a versatile range of operations here, we can assist all types of other manufacturers in getting their products completed and ready for shipment. It’s especially rewarding when one of our long-time partners is able to expand a product line that Keats has been an integral part of, which was the case with this dome light manufacturer. Landing a major contract with a domestic automotive manufacturer (our industry colleagues will understand our inability to use specific names here), our partner needed increased production from our end – and fast! Our new stamping press allowed us to step up and meet that need, keeping the dome lights rolling off the assembly line and into your car. Our numerous facilities and ample production space are ideal for this type of flexibility: obtaining new, dedicated equipment on demand to meet a specific need. Check out our website for more stories of manufacturing success.

U.S. Manufacturing Growth Strong in November

Automotive, spring stampings, military parts: the U.S. manufacturing industry covers a vast amount of products and uses, and all of it is surveyed periodically by the ISM. The ISM, or Institute of Supply Management, independently surveys incoming orders, new equipment deliveries, and, of course, production, and compares it against previous months and other countries. November’s report yielded results that came as a surprise to many, according to this MarketWatch report: not only was U.S. manufacturing booming, but it was outpacing the rest of the world.

While this is certainly good news, its unexpectedness yields some questions. Or, maybe, just one: “Why?” The article proffers a couple of theories, the most plausible of which are an expiring tax credit on new equipment, and increased auto production. Also mentioned is a corresponding and equally surprising lack of production in countries like Germany and Mexico. At Keats, our El Paso facility allows us to work closely with manufacturers in Mexico, and one of our, and their, key industries is the automotive sector. This partnership has always proven beneficial, in our view of the U.S. manufacturing picture, and we’re confident that this latest report will yield to signs of increased production at those facilities, while maintaining the strong trends here.

Steel Pricing Continues Steady Trend of Unpredictabliity

Keeping track of developments in steel markets can be a head-spinning endeavor, but that doesn’t mean we don’t try here at Keats Manufacturing. It’s well-known that our best advice, in the face of uncertain future cost trends, is to plan and purchase just as you always have. Accounting for cost increases and decreases is just too difficult, too frustrating, to try and do otherwise. Recent steel news illustrates this to a “T.”

Out of Indiana this week: NLMK’s flat rolled steel prices will be increasing, on the heels of Nucor’s decrease in coated steel pricing. Even more recently than either of these, South Korea’s Posco announced record stainless steel production, market expansion, and profitability. This, in one of the most tumultuous times for the industry in recent memory. Perhaps not surprisingly, Posco’s spokesperson played coy about raw material sources and costs. Magicians don’t reveal their secrets.

Unfortunately for many of us, material options are often limited, and we can’t jump from one material to another based on price alone. As this news from just the past few days shows, the only safe prediction is unpredictability.

FABTECH 2011: Metalworking in Chicago

Last week, FABTECH, the largest North American metal forming and fabricating expo, returned to Chicago. The conference is always a fantastic showcase for metal manufacturers and equipment suppliers, as well as a great opportunity to learn about the best ways of managing procurement, personnel, and other business aspects of the industry. FABTECH’s site provides a full listing of exhibitors, seminars, lectures, and other events that happened at the expo. See the detailed schedule here (PDF). Here’s a recap of a few events that were most interesting to us:

• Monday: Error-Proof Metalforming session. The tight tolerances of our four-slides allow us to come as close as possible to perfection – but who wouldn’t want to learn more?
• Tuesday: Shipbuilding professional program. With our past experience performing metal stamping for submarine components, this session immediately appealed to us.
• Wednesday: World Class Safety and How to Compete Globally session. Worker safety is always a primary concern of ours, and it’s great to see that our colleagues share this view.
• Thursday: Cloud Computing Basics session. For more information on cloud computing, click here. In short, this technology can help us be more efficient in sharing the results of services like design and inspection with our customers, and can help streamline our own in-house processes as well.

Please get in touch or leave comments with your own impressions of FABTECH 2011!

Demand Issues Affect Steel Prices

Worldwide production and economic issues have joined to produce some unfortunate side effects for steel manufacturers and metalworkers. As described in this article, ArcelorMittal, the world’s biggest steelmaker, is dealing with the aftereffects of a global recession, facing lowered demand and higher raw material pricing. This convergence of events, with market competition pushing commodity pricing down even as raw material procurement costs increase, creates a very uncertain climate in the industry.

Here at Keats Manufacturing, we pride ourselves on putting our customers first and offering as much assistance in purchasing as possible. Through our long experience in metal stamping, we’ve seen a lot of market ups and downs, and we’ve found that the best way to deal with them is to proceed with business as usual. That is, it’s rarely beneficial to attempt to “play the market” with steel, and costs over the long term will reflect this principle. Please contact us at Keats with any further questions!

A Question of Industry: Are Four-Slide Machines Obsolete?

Reading some LinkedIn posts recently, we came across a discussion that we couldn’t help but jump into. A fellow engineer asked whether the reliable and versatile four-slide machine had become obsolete. You can probably guess our answer! Although four-slide machines were originally invented to fabricate springs and wire forms (and continue to do so today), technicians from other industries have continually found new and innovative ways to use them, far beyond their original applications. Rather than being outdated, four-slides are contributing to cutting-edge, efficient and accurate manufacturing just as much as ever.
We were pleased to see that we were just one of a chorus of many voices answering the LinkedIn query with a resounding “No!”, whether from job shops with their own four-slides, or manufacturers that use those shops’ services. Just a few advantages mentioned throughout the discussion were:

• Increased speed as compared to die presses
• Superior product design applications
• Ability to produce more complex pieces
• Close tolerances

One of the best ways to ensure those advantages is to dedicate enough time to employee training and machine maintenance, and we cannot overestimate the importance of this to other four-slide users and customers out there. With over 100 machines at our facility, and the expertise and creativity to continue to push their boundaries, we look forward to proving their viability and usefulness for years to come.

Circuit Breakers and the Environment: Two New Products

One of the many diverse uses for metal stampings is in circuit breakers, which prevent electrical circuits from blowing out or short circuiting. Two new circuit breaker products that we’ve learned about are used in cutting-edge environmental technology that provide a great look at the continually evolving nature of the industry: Siemens’ electric car charging column and Eaton’s wind farm breaker .

The Siemens charging column represents a real turning point for the electric car industry. It’s expressly designed for use in public places like parking garages and curbside parking spots, and it can recharge two vehicles at once. Siemens’ investment in this type of product – one designed to be used outside the home – illustrates the increasing popularity of electric cars as much more than niche vehicles. The Eaton wind farm breaker uses a unique vacuum interrupting technology designed specifically for wind farm energy-collection points. It also doesn’t require cooling or ventilation. It’s great to see this type of innovation made possible by products like metal stampings, and we’re excited to see what’s next.

An International Outlook: Metal Manufacturing in Mexico

As discussed in this article, Mexico is now the largest supplier of metal automobile parts to the United States. In addition, 11% of cars sold in the U.S. are manufactured in Mexico. Although a large number of car manufacturing jobs are moving back to the U.S. from Mexico, it’s apparent that automotive manufacturing there is a force to be reckoned with. We consider it an exciting time to be part of the industry through our metal stampings, and look forward to partnership opportunities.

One of our biggest strengths here at Keats is our location. Our El Paso, TX facility allows us to be part of the manufacturing chain on both sides of the border. This is a great way to contribute to manufacturing in both places, increasing and improving auto parts production. We’re proud to be part of the resurgent automotive industry as it enters its next phase, here in the U.S., and worldwide. Visit our site for more info on all applications for our metal stampings.