E-IJPM: Vol. 44/4 - MPIF

STATE OF THE PM INDUSTRY IN NORTH AMERICA—2008
Figure 2. North American shipments of copper and copper base powders.
Figure 3. North American metal powder shipments.
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light trucks which contain up to 29.5 kg (65 lb.) of
PM parts per vehicle. Overall, the North American
PM demand for powders will fall 25% between
2004 and 2008.
Copper powder shipments have also fared poorly,
declining by 8.2% to approximately 18,065 mt
(19,900 st), Figure 2. Tin powder shipments
plunged 19.4% in 2007 to 713 mt (785 st). Early
reports for 2008 show a continued decline in consumption
of copper and tin with both markets negatively
impacted by the softening PM parts market
and high commodity prices. These high prices have
certainly opened the gates for substitution.
Stainless steel and nickel demand in 2007
declined an estimated 5% to 8,783 mt (9,675 st)
and 8,315 mt (9,160 st), respectively. On the
bright side, tungsten and tungsten carbide powder
shipments increase an estimated 3% to 4,221
mt (4,650 st) and 6,681 mt (7,360 st), Figure 3.
VOLATILE COMMODITIES IMPACT PM
MATERIALS
During the past two years volatile commodity
prices have played havoc with metal powder manufacturers
and their customers, the PM parts
makers.
Roller-coaster prices of steel, copper, nickel,
tin, and molybdenum have all impacted the PM
marketplace. Steel scrap prices rose 33% in 2007
from $243/st to $322/st. The buzz in every hallway
of this conference is the skyrocketing price to
over $800/st in June of 2008, a 150% price
increase over the past 6 months.
Nickel is another story. The average price in
2006 was $6.68/lb., in 2007 it jumped to
$16.88/lb., and in 2006 it had fallen to
$13.13/lb.
All PM companies are faced with surging utility
prices. Over the past 12 months through June of
2008, natural gas prices have increased 54%, coal
for electrical generating plants is up 210%, and
crude oil is up 200%. We must, however, remember
that most substitute materials and competing
technologies face similar dramatic material and
utility price increases leaving PM producers with
their fundamental pricing advantage intact.
HOPE IN THE AUTOMOTIVE MARKET
While PM has suffered because of structural
changes in the automotive market, production
cuts, and the negative impact of the American
Axle strike, there is still cause for optimism.
Despite the many challenges, North America continues
to lead the world in consumption of iron
and steel powders, approximately 363,120 mt
(400,000 st) compared with 272,340 mt (300,000
st) for Asia, and 181,560 mt (200,000 st) for
Europe.
As a near net-shape technology, PM’s cost savings
benefits are second to none. High-visibility
products like powder-forged connecting rods,
main bearing caps, and transmission carriers are
still manufactured in high volumes and used by
both the domestic OEMs and transplants.
Industry insiders tell us that Japanese automotive
transplant companies are opening their doors
wider to new PM applications as they seek to
reduce costs. It may be a slow process to get a
purchase order but it is sustainable long-term
business. Most design decisions, though, are still
made in Japan, especially for the powertrain
parts; North American parts makers must develop
relationships with engineering departments there.
New engines and six-speed transmissions contain
more PM parts. For example, six-speed trans-
Volume 44, Issue 4, 2008
International Journal of Powder Metallurgy