The U.S. steel industry, hammered by imports in the past, now is turning the tables a bit with a dramatic increase in exports in recent months to European and Asian countries.
One of the chief beneficiaries of the surge is Bethlehem Steel Corp.'s Sparrows Point mill in Baltimore County, where exports have multiplied by 20 this year to 400,000 tons.
But, even though Sparrows Point hopes to cement some of these new foreign relations, analysts warn that the export boom may fade as foreign economies hit their peak and decline.
The American Iron and Steel Institute, the trade group for the steel industry, yesterday reported that steel exports in June reached 641,815 tons -- 37.5 percent higher than May exports of 466,621 tons and 77.8 percent higher than the 360,951 tons shipped in June 1994.
May was the largest single month of exports since June 1991, when 772,044 tons were shipped.
For the first six months of this year, exports totaled 2.7 million tons, 43.3 percent ahead of the tonnage in the same period a year ago.
While exports still are only one-seventh of steel imports, analysts say exports have been an important means of keeping sales up while domestic demand has flagged.
"The recovery overseas is part of it, but with the slowdown here in the domestic economy, all our American companies are pushing like crazy to sell more overseas, whether it's Europe or Asia," said Donald L. Wampach, vice president of Duff & Phelps Equity Research, a stock research operation in Chicago.
The lower value of the dollar in relation to other currencies and rising foreign demand for steel have worked to make American steel more competitively priced. But companies must still shave their profit margins for the foreign market, Mr. Wampach said.
"It does eat into the margins. They're not as strong," he said. "The idea that they are shooting for is that they will make up in volume what they are losing in the price."
Mr. Wampach expects the export surge to continue through the rest of the year. After that, he is uncertain where the steel industry will go.
"It's so foggy," he said.
Another analyst, who asked that his name not be used, said he expects the export rally to play out in the first few months of 1996 as the European and Asian markets slacken.
But the management at Sparrows Point, which has a work force of 5,300, is intent on trying to hold onto its foreign sales, which will account for about 13 percent of the mill's 3 million tons of production this year.
"We've been working very diligently at a long-term game plan in the export market," said Duane R. Dunham, president of the Sparrows Point Division. "I do not see it as a short-term situation."
Mr. Dunham disputes that foreign sales have a lower profit margin than domestic business. "That is not correct. In some cases yes. In some cases, it's absolutely false," he said. "It all depends upon the product, the specific application."
Early this year, he said the plant's management targeted foreign sales as it foresaw a cutback by major customers to reduce burgeoning inventories.
"Our people had to do some heroic things this year to move as rapidly as we did," Mr. Dunham said. "That was a Herculean effort made by a lot of people here at Sparrows Point, and they're the real champions."
Now the plant is trying to keep this business by emphasizing the benefit of its waterfront location and its desire to meet customers' needs.
"The people we are doing business with worldwide now really like doing business with the Sparrows Point Division," he said. "They like our product. They like the way it's packaged."
