Rolling Mill Machinery and Equipment

SIC 3547

Companies in this industry

Industry report:

This category covers establishments primarily engaged in manufacturing rolling mill machinery and processing equipment for metal production, such as cold forming mills, structural mills, and finishing equipment.

According to the U.S. Census Bureau�s Annual Survey of Manufactures overall shipments for this industry were valued at nearly $734 million in 2009, down from a total of $876 million in 2008. Industry-wide employment as of 2009 totaled approximately 3,068 workers receiving a payroll of more than $173.7 million. Of those employees, about 2,079 worked in production in 2009, putting in more than 4.6 million hours to earn wages of more than $106.5 million. About 97 percent of establishments in this industry employed fewer than 250 workers. The top 3 percent of the largest firms generated roughly 40 percent of the industry�s revenues.

Penn Machine Co. of Johnstown, Pennsylvania, had 2010 sales of nearly $42 million and about 135 employees. RB&W Manufacturing LLC of Kent, Ohio, had 2010 revenues of $1.4 million. Foseco Inc. of Cleveland, Ohio, had more than $17.8 million in sales.

The U.S. government divides rolling mill machinery into four classifications: hot rolling mill machinery (except tube rolling), cold rolling mill machinery, other roll milling machinery (including tube mill machinery), and rolling mill machinery that is not classified elsewhere. To produce typical metal sheets and plates, hot rolling mill machinery decreases the metal's thickness and the product is then sent to a cold rolling mill machine to further reduce it by implementing intricate processes of measurement.

The capital requirements for the industry are relatively low, with average investment per establishment at about 25 percent of that for the manufacturing sector as a whole. In 1995, the value of shipments for these four classifications was $621 million. This figure spiked in 1997, with shipment values at more than $700 million. Two years later, the number plummeted to less than $430 million. After shipment values briefly rebounded in 2000, to more than $579 million, the industry witnessed steady annual losses, which totaled nearly $444 million in 2004. Increased productivity led to increased revenues, which totaled $739 million in 2006, up from $672 million the previous year. By 2008 the value of products shipped reached $876 million, but then declined to $734.4 million in 2009 due to global recession, which blunted demand.

According to the U.S. Department of Labor, long-term employment is projected to decline about 16 percent between 2004 and 2014 for metalworking machinery manufacturing as a whole. This includes projected decreases in demand for machine setters, operators, and tenders of metal and plastic products by 2014, directly caused by production technology advancements and overseas competition. For the specific rolling mills manufacturing industry, the number of employees has experienced a consistent decline. From a high of 4,290 employees in 1998, the workforce fell to just over 3,000 in 2001 and 2,617 in 2004, representing an actual loss of 39 percent in a mere six years (between 1998 and 2004). Employment levels declined further to a total of 2,598 in 2005, only to rebound slightly to 2,761 in 2006, increase slightly during 2008 and 2009, and reach 3,068 in 2009.

According to industry statistics, in 2010, the two highest ranking states by number of industry establishments were Ohio (22 establishments) and Pennsylvania (18 establishments). Together, these states account for 35 percent of total employment for the industry, and more than 50 percent of its shipment values. According to the U.S. Census Bureau, the hot rolling mill machinery industry accounted for nearly 20 percent of shipment values, while the cold rolling mill machinery industry produced more than 16 percent. The rolling mill machinery industry, not elsewhere classified, including tube mill machinery, processing lines, and machined rolls for rolling mills, led with about 61 percent.

The top five industries and sectors buying the industry's output were: gross fixed private investment, with an estimated 75 percent share; exports, with an estimated 18 percent share; change in business inventories, with an estimated 4.0 percent share; and rolling mill machinery, with an estimated 3 percent share. The federal government purchased less than 1 percent for national defense purposes.

Improvements in efficiency and productivity are continual areas for newer developments. For example, Foseco Inc. began using a high-end automated metal treatment station in 2005 that is more economical and environmentally friendly. Also, enhancements have been made to the inspections processes used by manufacturers, which look for costly surface cracks in the material via retrofitting existing machines with electronic load monitoring and inspection devices for not only the rolling mills themselves, but also the product being processed by the machines. Another concern in this industry involves upgrades in safety measures to protect employees. An Ohio-based company previously used a roller designed for large diameter pipes that was not designed with guards in place to prevent employees' hands from being pulled into the rollers. The violation was finally corrected in the early years of the first decade of the 2000s after a decade of risk.

In the late 2000s, the industry was hampered by a stagnant economy due to an economic recession. A banking crisis and credit crunch had locked down U.S. economic growth, which only began to return during 2010. The struggling industrial and manufacturing industries within the United States were expected to stage a (slow) comeback, which was already in evidence during 2010. Machinery providers looked for increased profits as the U.S. steel industry retooled and upgraded after several very difficult years in which most capital projects were placed on hold. The high demand for and price of steel and other components, however, threatened to put a damper on growth as machinery suppliers worked under dangerously thin margins in an attempt to find common ground with their customers and also meet their bottom lines of sustainability and profitability.

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