COMMENT: Section 232 promises more pain than gain for AISI 4130 chrome moly prices

Losses in job and output terms in metals-consuming sectors in the United States in the fallout from the Section 232 probe threaten to outweigh any benefits to domestic metal-producing industries from the tariffs the US government subsequently introduced.

In turn, the prices of metals that are strongly correlated to the performance of metal-consuming sectors - such as AISI 4130, a widely used medium carbon/low alloy steel commonly called chrome moly and known as 30CrMo4 in Europe - may come under downward pressure. The pricing dynamics of AISI 4130 are heavily linked to forgings used in the aerospace and oil and gas industries - as forged valve bodies and pumps - as well as to the automotive, agricultural and defense industries. This makes it perhaps one of the forms of steel most sensitive to changes in demand. After plunging in the third quarter of 2015 from close to $900 per tonne, it traded in a relatively narrow band globally for much of 2016 of $650-750 per tonne ex-works, reflecting the low price of raw...

Published

Brian Levich

April 26, 2018

13:20 GMT

London