Our other special focus this week is on Steel. We talked with analyst Bob Richard with Longbow Research, who told us about what steel pricing was going to do in the immediate future, given the lessening in demand:
TWST: With the slack demand, has the industry pretty much maintained pricing discipline?
Mr. Richard: Yes, they have. Pricing came down in the back half of 2007, but we didn’t see severe volume discounts. Eight years ago, producers would fight each other tooth and nail on steel pricing and then undercut the other guy the following week. Now, with a restructured industry, with the much lesser pension obligations, you don’t have the cash requirements that you had before the 2001 restructuring. The producers are therefore able to exhibit much more pricing discipline than they were at the beginning of this decade.
For the full Steel report, including interviews with a variety of analysts, as well as an outlook for 2008 in the steel industry, click here.
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