EoW September 2008

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EuroWire – September 2008 19
english corporate news
The editor of Fastener & Fixing magazine,
Phil Matten delivered a hard-hitting
analysis of the factors propelling the cost
of all types of steel fasteners along the
steepest inflationary track witnessed in
decades.
Matten told a packed forum at June’s
Fastener Fair in Coventry, UK that he could
see costs across the range of standard
steel fasteners being 40% to 60% higher
than 2007 levels within a matter of
months.
With cold heading wire prices in Europe
set to increase dramatically within weeks
(one forum participant confirmed that
€250 per tonne would be added to
his production costs in July) and Asian
raw material costs continuing to ramp
up, Matten saw little sign of inflationary
pressures abating.
The main contributors were steeply
increasing steel prices, driven by
extraordinary increases in raw material
costs across the world, for example:
Iron ore contract prices have increased •
year on year by at least 65%
The cost of coke, an essential •
ingredient in steel making, has
increased by as much as 200%
compared to 2007
Matten went on to detail the impact
of bulk sea freight, currency exchange
trends, as well as energy and labour costs
on the prices of finished fastener products
from Asian and European sources.
While current circumstances were
exceptional and some level of
correction was inevitable, if very difficult
to predict, Matten argued that a long
term inflationary trend for fastener
products appeared an unavoidable
reality, leaving the supply industry and
its customers no choice but to come to
terms with it.
Consolidation meant a more structured
steel market, more specialisation, a tighter
balance between supply and demand
and more robust market pricing, he said.
“A small number of powerful mining
companies, together with the major
steel players have savoured strong profits
over recent years, and are intent on
holding on to them.”
The prospect that the European
Commission may, within a matter of
weeks, apply antidumping tariffs on an
extensive range of fasteners from China,
threatened to further exacerbate the
situation, the forum audience was told.
A protracted EU investigation, which
started in November 2007, meant
growing uncertainty for fastener
importers as the 9th August deadline for
a decision on preliminary antidumping
tariffs drew nearer.
Depending on the investigators’
interpretation of one of the most complex
antidumping cases addressed by the
EU, the application of tariffs could, quite
feasibly said Matten, mean fastener prices
doubling year on year.
One forum attendee responded: “All we
have to do now is get our customers
to recognise that fastener companies
like mine are on the receiving end of
pressures that are outside of our control.”
The next Fastener Fair Coventry is
scheduled for June 2010.
Fastener Fairs Group – UK
Fax: +44 1727 831 033
Email:
Website:
Prospect of doubled fastener prices
– delegates warned
Phil Matten delivering his message to the ▲ ▲
Fastener Fair, Coventry UK