Steel chiefs express a bit of optimism

May 28, 1992|By Thomas Easton | Thomas Easton,New York Bureau

NEW YORK -- Top executives of the major integrated steel companies, meeting here yesterday, expressed muted optimism about a rebound from a disastrous 1991 and vowed to vigorously pursue complaints against dumping by overseas competitors.

Their comments came on the first day of the annual meeting of the American Iron and Steel Institute. Attending were about 600 manufacturers, buyers and suppliers, about the same number as last year but little more than half the typical level of the 1960s and 1970s, when industry-wide employment was about 500,000, compared with 180,000 today.

Suggesting a glimmer of hope in what has been an awful past year and an awful decade, Walter F. Williams, chief executive of Bethlehem Steel Corp., predicted that his company's planned price increase of 1.7 percent to 2.9 percent would stick, after two increases failed.

"The timing is better," he said. "Even customers recognize our profitability has to increase."

Bethlehem's move was echoed yesterday by LTV Corp.'s steel unit and the U.S. Steel division of USX Corp., which said they would raise prices on flat-rolled steel by as much as 2.8 percent in July.

Steel manufacturers have lost money in eight of the past 10 years while consumption and pricing have regressed to levels not seen since the recession of the early 1980s, said Charles A. Corry, chairman and chief executive of USX Corp.

In 1991 alone, industry losses in the United States have been estimated at $2.2 billion. Bethlehem was bludgeoned by falling sales and prices, losing $767 million last year. The company reported losses in this year's first quarter and expects to do so for the second quarter.

"I hope we will be profitable before too long," Mr. Williams said.

Despite the continued erosion in Bethlehem's finances, its modernization program is continuing, Mr. Williams said at a news conference. A $200 million hot strip mill at Sparrows Point was completed in the fall. A $140 million galvanizing line at Sparrows Point is expected to be running by year-end.

David H. Hoag, chief executive of LTV, echoed the views of a half-dozen steel executives speaking yesterday, saying he expected the industry's future to be better. Suggesting that the industry might already be profitable thanks to a recent increase in factory use, he projected this year "will be better than last year but still far from satisfactory."

Aggravating the harsh conditions tied to a slow economy, steel industry executives said, were cheap imports that undermined volume and prices.

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