US steel industry in collapse



THE US steel industry is reportedly in collapse and looking for a massive government investment program of up to $US1 trillion ($1.42 trillion) to stimulate demand.

Output of steel has plunged 50 per cent since September as construction and car production have fallen sharply amid a US recession and the global credit crunch, The New York Times reports.

Industry executives are pleading for a huge public infrastructure investment program - of up to $US1 trillion over two years - under president-elect Barack Obama's proposed stimulus plan, the newspaper says.

It quotes Daniel DiMicco, chairman and chief executive of the Nucor Corporation, a giant steel maker.

"What we are asking is that our government deal with the worst economic slowdown in our lifetime through a recovery program that has in every provision a 'buy America' clause," he said.

Economists in the Obama camp have said the President-elect will propose a stimulus plan that will include significant infrastructure spending that draws on heavy industry.

The steel industry could spring back to life through construction of highways, bridges, electric power grids, schools, hospitals, water treatment plants and rapid transit, industry executives told the New York Times.

Nancy Gravatt, a spokeswoman for the American Iron and Steel Institute, said: "We are sharing with the president-elect's transition team our thoughts in terms of the industry's policy priorities."

The industry decline accelerated in November and December.

By late December, output was down to 1.02 million tonnes a week from 2.1 million tonnes on August 30, according to American Iron and Steel Institute figures cited by the newspaper.

The price of a tonne of steel has fallen by half in recent months.

News.com.au