The steel industry should continue to remain profitable, although slightly less than 2006, according to Euler Hermes ACI, a trade credit insurance firm based in Owings Mills, Md.
"The fourth quarter of 2006 saw some real benefits of the consolidated market as many domestic mills planned outages and cutbacks to help rectify the situation," said Tony Clary, risk vice president, Euler Hermes ACI.
With imports at near-record levels and seasonally slow demand causing weakened steel prices, Clary said many buyers are holding off placing orders to see how much further prices will fall. "In the short term there may still be some months of further price declines before the supply correction actions take complete hold. Over the medium term however some stability is once again expected," he concluded.