Steel Industry Stressed As Automakers Use More Aluminum

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The automakers move towards aluminum is worrying many in the steel industry.

As The New York Times reports, “For nearly a century, Ford’s River Rouge factory and its neighboring steel mill have worked in close harmony to produce some of America’s most popular vehicles, from the Model A to the F-150 pickup truck.”

“But ever since Ford announced last month that it would make the body of its new F-150 mostly out of aluminum, that steel maker, which was spun off by Ford in 1989, has faced the unsettling prospect that its longtime partner is drifting away.”

“Carmakers’ shift to aluminum has raised apprehension among steel makers, which have been fighting an increasingly uphill battle simply to maintain their business. Now, they are trying to respond, making lighter, stronger steel in a bid to retain one of their most important customers, the automakers.”

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“’The traditional view has been steel or nothing else,’ said Saikat Dey, chief executive of Severstal North America, the United States subsidiary of Russia’s Severstal Group, which now owns the Rouge steel operations. ‘I think we all need to accept the reality that we live in a mixed-material world.’”

In metal price news for aluminum…

The cash price of primary aluminum saw the biggest increase at 1.0 percent on the LME, finishing at $1,734 per metric ton for Monday, February 24. On the LME, the aluminum 3-month price rose 0.9 percent to $1,777 per metric ton. The cash price of primary Indian aluminum rose 0.5 percent.

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Chinese aluminum closed mixed yesterday. Chinese aluminum primary saw its price drop 0.8 percent yesterday. The price of Chinese aluminum scrap held steady. The price of Chinese aluminum billet saw essentially no change for the fifth day in a row. For the fifth consecutive day, the price of Chinese aluminum bar held flat .