Association of Equipment Manufacturers Commends House for Focus on Steel Concerns

WASHINGTON - The Association of Equipment Manufacturers commends the House Small Business Committee and its Chairman Don Manzullo (R-Ill.) for drawing attention to the challenges manufacturers face due to rising steel prices. The committee held a special hearing March 10, 2004, on the sudden increase in steel prices and limited steel supplies.

"The sudden rise in steel prices and reports of short supply are worrisome to both small and large manufacturers," said AEM President Dennis J. Slater. "A complicated set of international and domestic factors has contributed to the surge in steel prices."

The association relayed equipment manufacturers' concerns on these issues to the House Small Business Committee staff prior to the hearing.

AEM is the North American based international trade group for manufacturers of construction and agricultural equipment and related industry services providers.

In AEM's 2003 Fourth Quarter Industry Conditions Survey, association members in the components-, light-equipment and heavy-equipment industry segments signaled concerns about increasing steel prices, limited supplies and their potential impact on the equipment market.

"Positive economic indicators have recently encouraged a sense of optimism about the potential for a strong equipment industry recovery. However, this optimism is guarded by the growing concern about steel costs and availability as manufacturers adjust to the forces of an increasingly global marketplace," said AEM President Dennis Slater.

The Small Business Committee heard testimony on the primary causes of the sudden steel price increase such as shortages of coke used to make steel, the strong demand for steel from China and India and the weak dollar's impact on import prices.

"It appears as if there is not one single factor that would indicate why prices have risen to the degree they have, but rather a culmination of many factors," Manzullo said.

"There is no quick fix here."