Final Thoughts

While speaking with a couple of the secondary flat rolled steel distributors this past week, we got into a discussion about the advanced high strength steels (AHSS) and what impact they were having on the secondary market. A number of service centers pointed out that the product was fine for flat parts or those with a 90 degree bend. The product has been going into some construction products such as wall ties and edging. The issue is not the original form or bend put into the steel it is the secondary process such as knockouts finds the material too hard to work.

A secondary service center in the South told us regarding high strength steels, “New HSS products constitute an ever-increasing share of secondary steel and they are problematic because their physical characteristics make them unsuitable for many of the typical non-prime applications.  These products are in some ways reverse engineering the supply chain for secondary users.  It represents an opportunity for customers who can use these extremely hard steels, but a dilemma for those who cannot as the available pool of commercial grade steel diminishes.  When the market tightens at some point in the future, those who have not adapted their processes to accept these new grades may well find themselves with limited sourcing and premium pricing for what limited amounts of material they are able to obtain.  This trend to HSS does not appear limited to automotive, but is occurring in other segments as well.”