The iron age and after 1974

 Everyone expected the 30 percent to 40 percent auto slowòown in (f) irst quarter 1974 (to) make more sheets available for the generai sheet...

 Everyone expected the 30 percent to 40 percent auto slowòown in (f) irst quarter 1974 (to) make more sheets available for the generai sheet using market. This has not happened. Automotive has continueà to take the sheet allocated to them. They have shippeò it to tneir overseas plants, sold some of it to brokers, and passed some of it along to their own subcontractors. . Little if any additional tonnage is being offered to the market. . . . (Foreign) Pr ices for long standing good accounts are apparently 30 percent to 50 percent above domestic with arising trend. Steel for new accounts or sold by brokerS¡,Jl,ight be double the domestic price or more. 46/ By August of 1974, with price controls lifted, the steel mills rãisej 1 ist pr ices by 30 percent to 40 percent. The Steel Committee reported in August 1974 that these pr ice increases stuck. 47/ By the fourth quarter of 1974, demand began to weaken. It did not weaken uniformly, however, and modest price increases were announced in December 1974 for the two products in strongest demand: plates anci shapes. 48/ Due to the differential impact of the scrap passthrough permitt~d by the Cost of Living Council, a multi-tiered list pricing schedule haò developed in January 1974. ~/ However, 46/ "The Steel Market," Bulletin of the National Association õ1 Purchasing Managemènt, May 1974, p. 6. ~/ Ioià. Aug. 1974, p. 7. 48/ 

"After Two Years Buyers are Back in the Drivers Seat,. Iron~, Dec. 9, 1974, p. 44. ~/ "Steel Summary," Jron Age, Jan. 14, 1974, p. 57: "Six More Steelmakers Lift ~Prices, Causing Rare Pricing Chaos in the-Inàustry,~ Wall Street Journal, Dec. 31, 1973, p. 5 i -191- in the first quarter of 1975, firms, under demand pressures, were shaving prices to meet the lowest quotes of competitors. 50/ Price shaving by minimills was reported through the second and third quarters, while discounting appeared in the specialty steel markets. 51/ In testimony before the International Trade Commission, R. Simmons, president of Allegheny Ludlum, presented data on his company's delivered transactions pri~es of stainless cold rolled sheet in Chicago. These data show a cycl ical trend: rising during the 1973-74 boom and falling during the 1975 contraction. On the basis of reports from American Metal Market and the Wall Street Journal, Jondrow et al. (12) constructed an index of percentage discounts from list during the 1973-75 period. Jondrow et al. report the appearance of price discounts during 1975 on a composite index of steel prices constructed according to the source of steel. These data are reproduced below as table 4.7. 50/ "Softening of Steel Prices is Appearing on Some Steel Items Due to Easing in Demand," Wall Street Journal, Feb. 10, 1975, p. 2. 51/ .Some Small Steel Firms Offer Discounts to Cut Stocks, Boost Sales to Auto Market,. Wall Street Journal, June 6, 1975, p. 3; "Price Cutting in Steel Develops; Demand Low,. Journal of Commerce, July 3, 1975, p. 1; "Buyer Aware: How Lloyd Konrad, A Purchasing Agent, Wheels for Good Deals,. Wall Street Journal, 9ct. 7, 1975, p. 1.