Industry News

A brief review of the US paper industry is illustrative.  The

The

Roll Rebuilding and Recovering depends to no small degree on the state of the paper industry.  As mentioned above, the

With regard to the general state of the industry for job and machine shops, the roughly 23,000 independent shops in the

Demand for machine shops and their output depends on US manufacturing activity. According to Reuters, the

Sources 

“The US Paper Industry and Sustainable Production,” sonic.net

“Pulp and Paper Mills Industry,” firstresearch.com 1/21/08 

“Machine Shops,” hoovers.com, 11/5/07 

“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07

Prior to the beginning of World War II in 1939,

Operation Bootstrap was generally considered a success.  It brought many industrial companies to

By 1965, Puerto Ricans enjoyed the highest per capita income in

Goods manufactured or assembled in Puerto Rico primarily use imported industrial components. 

Overall,

Specifically with regard to demand for machined goods, in

Sources 

“

 lcw.lehman.edu

welcome.topuertorico.org/economy

“

Britannica.com

“Economic Census,” census.gov 

“US Manufacturing Growth to Rebound in 2008,” reuters.com,

“Manufacturing Industry out of steam in 2007,”

A brief review of the US paper industry is illustrative.  The US per capita consumption of paper is over 700 pounds per year, by far the highest in the world.  Other major developed countries have substantially lower per capita consumption, as much as 20, 30 or 40% lower than in the US, partially as the result of many countries’ concerted efforts to substantially reduce packaging. (“The US Paper Industry and Sustainable Production,” sonic.net)

 The US pulp, paper and paperboard mill industry consists of about 270 companies with total combined annual revenue over $70 billion.  An average mill has about 300 employees and annual revenue of $125 million.  The industry is highly concentrated; the top 20 companies produce 75% of industry revenue. Demand in the industry depends on both consumer and business use of paper products. The profitability of individual companies depends largely on production efficiency.  Paper mills are highly automated and capital intensive.  (“Pulp and Paper Mills Industry,” firstresearch.com 1/21/08)

 Roll Rebuilding and Recovering depends to no small degree on the state of the paper industry.  As mentioned above, the US consumes considerably more paper than any other country in the world,  and that statistic is unlikely to change significantly in the near future.  Therefore, it follows that roll rebuilding and recovering business should remain fairly consistent.

 With regard to the general state of the industry for job and machine shops, the roughly 23,000 independent shops in the US have combined annual revenue of $30 billion.  None is publicly owned, and most companies operate a single shop.  The industry is thus highly fragmented; the 50 largest companies hold less than 15% of the market.    Profitability is linked to engineering expertise and operating efficiency.  Larger shops can invest in advanced production machinery, while smaller shops can compete by serving specialized customers.  (“Machine Shops,” hoovers.com, 11/5/07)

 Demand for machine shops and their output depends on US manufacturing activity. According to Reuters, the US manufacturing sector growth is expected to rebound to 2.9% in 2008 (up from 2% in 2007, but still down from 4.7% in 2006).  While the manufacturing sector is not seen as able to shake off completely the depressing effect of the housing market collapse and the downward drifting motor vehicles market, some segments of the industry did show double digit growth in 2007, a trend expected to continue into 2008. (“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07)

 Sources

“The US Paper Industry and Sustainable Production,” sonic.net

 “Pulp and Paper Mills Industry,” firstresearch.com 1/21/08

 “Machine Shops,” hoovers.com, 11/5/07

 “US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07

Digital pressure gauges are devices that convert applied pressure into signals, with readouts then being displayed numerically. They are capable of performing various pressure measurements and displaying amounts in different units. Some digital pressure gauges display measurements in pounds per square inch (PSI), kilo pascals, bars or millibars, inches or centimeters of mercury, or inches or feet of water. Such devices differ in terms of maximum allowable pressure, accuracy, vacuum range, and operating temperature. Accuracy is often denoted by a letter grade, from 4A (permissible error of 0.1% of span) to D (5% error). Digital pressure gauges are used in a variety of industries and have pharmaceutical, food processing and automotive applications. They are also used in containment and monitoring of hazardous materials. (“Digital Pressure Gauges Information,” sensors-tranducres.globalspec.com; “Pressure Gauges,” omega.com)

In general, US demand for sensor products (all types of sensors, transducers and housings) is expected to rise 6.7% per year to over $15 billion in 2010. The fastest growth is expected in sensors based on more advanced, sophisticated technologies and sensors to be used in dynamic applications such as automotive safety and security systems, consumer electronics and information technology. Demand for sensors based on MEMS technology is also expected to advance above the pace of the overall sensor market. (“Sensors,” marketresearch.com, 4/1/06)

As for the machine shops creating such items, the roughly 23,000 independent shops in the US have combined annual revenue of $30 billion. None is publicly owned, and most companies operate a single shop. The industry is thus highly fragmented; the 50 largest companies hold less than 15% of the market. Profitability is linked to engineering expertise and operating efficiency. Larger shops can invest in advanced production machinery, while smaller shops can compete by serving specialized customers or by providing engineering services. (“Machine Shops,” hoovers.com, 11/5/07)

Demand for machine shops and their output depends on US manufacturing activity. According to Reuters, the US manufacturing sector growth is expected to rebound to 2.9% in 2008 (up from 2% in 2007, but still down from 4.7% in 2006). While the manufacturing sector is not seen as able to shake off completely the depressing effect of the housing market collapse and the downward drifting motor vehicles market, the electrical equipment, mining/oil/gas field equipment, aerospace products, communications equipment, and industrial machinery industries all showed double-digit growth in 2007, a trend expected to continue into 2008. (“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07)

Sources

jlwinstruments.com

“Digital Pressure Gauges Information,” sensors-tranducres.globalspec.com

“Pressure Gauges,” omega.com

“Machine Shops,” hoovers.com, 11/5/07

“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07

The fertilizer industry depends heavily on the agricultural crop production industry, which currently includes one million crop farms covering over 300 million acres in the US. The agricultural sector has combined annual revenue of $100 billion. Demand for crops in turn depends heavily on population and the condition of export markets. As the world’s population continues to climb to an estimated 9 billion by 2025, experts estimate that food production must increase more than 2% annually to maintain current diets. Crop yield is also a significant factor in profitability. Commercial fertilizers are seen to be key to these factors. With good fertilizers and high yield farming practices, more food is produced per acre per year, and fruits and vegetables are available in affordable abundance. (“Agricultural Crop Production,” hoovers.com; The Fertilizer Institute, “Fertilizer Facts and Stats,” tfi.org)

Although the US fertilizer market is valued at approximately $40 billion per year with almost 58 million total tons of fertilizer used in the US, fertilizer use leveled off in the late 1970s. The fertilizer market is thus currently seen as a mature market leading to use fluctuations of only 2-3% per year. The current high gas prices are exacting a heavy toll on nitrogen fertilizer producers and the farm customers they supply. The cost of natural gas, which is used as a feedstock in nitrogen production, accounts for as much as 90% of the cost of producing nitrogen fertilizer. High gas prices lead to high fertilizer prices, as well. An emerging niche in the market is that of organic fertilizer. While it is currently a very small share of the market, demand is growing along with that of organic food and other items. (tfi.org; “Organic fertilizer companies see growing market, but efficacy debated,” marketwatch.com 5/21/07)

Sources

“Agricultural Crop Production,” hoovers.com

The Fertilizer Institute, “Fertilizer Facts and Stats,” tfi.org

“Organic fertilizer companies see growing market, but efficacy debated,” marketwatch.com 5/21/07

Metal Stamping is used to create parts to a specific size, shape and configuration by “stamping out” a desired shape from a metal blank, Steel, Aluminum or other non ferrous metals. The machines, normally called a “Stamping Machine” is configured with a male and female “Die Set” this die set can be an exact duplicate or can be made to the mirror image of the part shape. The Stamping machine with its dies set can be as simple as a manually, or hand operated machine, to a hydraulically operated machine that can exert many tons of pressure. The metal stamping industry produces high volumes of parts at very low cost.. (“Metal Stamping Manufacturing About,” engineersedge.com; “Metal Stamping Informational Page,” metalstamper.net)

Revenue for the metal forging and stamping industry in 2006 was $12.2 billion, with gross profit of 23.24%. There were over 1500 establishments in the industry in 2006. It is estimated that more than 80% of manufactured goods and capital equipment use forging and stamping as engineered components, or rely on castings for their manufacture. (“Metal Stamping Industry in the US,” marketresearch.com; “US Forging & Stamping Industry Market Research Report,” ibisworld.com)

As for the machine shops creating such items, the roughly 23,000 independent shops in the US have combined annual revenue of $30 billion. None is publicly owned, and most companies operate a single shop. The industry is thus highly fragmented; the 50 largest companies hold less than 15% of the market. Profitability is linked to engineering expertise and operating efficiency. Larger shops can invest in advanced production machinery, while smaller shops can compete by serving specialized customers or by providing engineering services. (“Machine Shops,” hoovers.com, 11/5/07)

Demand for machine shops and their output depends on US manufacturing activity. According to Reuters, the US manufacturing sector growth is expected to rebound to 2.9% in 2008 (up from 2% in 2007, but still down from 4.7% in 2006). While the manufacturing sector is not seen as able to shake off completely the depressing effect of the housing market collapse and the downward drifting motor vehicles market, the electrical equipment, mining/oil/gas field equipment, aerospace products, communications equipment, and industrial machinery industries all showed double-digit growth in 2007, a trend expected to continue into 2008. (“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07)

Sources

“Metal Stamping Manufacturing About,” engineersedge.com

“Metal Stamping Informational Page,” metalstamper.net

“Metal Stamping Industry in the US,” marketresearch.com

“US Forging & Stamping Industry Market Research Report,” ibisworld.com

“Machine Shops,” hoovers.com, 11/5/07

“US Manufacturing Growth to Rebound in 2008,” reuters.com, 9/5/07

China has become, is becoming or will become a “world plant,” which is the optimistic estimation of many people. However, there is also another voice that China now is only a “world workshop”. What the estimation actually means is that currently the main focus of the manufacturing industries in China lies in processing materials supplied by clients and the capability of manufacturing sophisticated products in China is not strong and the overall competitiveness is not high.

It is not important if China is a “world plant” or a “world workshop”. What matters is that there are weak points in the manufacturing industries in China. China’s manufacturing industries cannot match with the world’s most advanced ones until the weak points are solved. With China’s entry into WTO and the growth of economic globalization, it seems extremely urgent for China to solve the weak points.

Speaking at the World Engineers Conference held in early November in Shanghai, Xu Kuangdi director of Chinese Academy of Engineering (CAE) said that China is still a material processing center instead of a manufacturing center due to the current manufacturing level, particularly the gap between the level of China’s manufacturing industries and that of the world’s advanced.

Xu also said that China’s gap with the world was periodical, which meant that China is only like a pupil if compared with other advanced countries like a middle school student. As showed by the disparity, China’s manufacturing industries are still dominated by low-end manufacturing industries and the added value of the products is only 26.23 per cent. Being the big exporter, China’s exports are mainly the labor-intensive products with low technical contents. Meanwhile, the energy consumption of China’s manufacturing industries is often 20-30 per cent higher than that of the advanced countries.

China’s equipment manufacturing has long been in separation. For instance, blower factory only produces air blowers while dynamo maker only manufactures dynamos. This situation results in the neglect of developing packaged technology, especially the systematic reliability. Even if the reliability of one part reaches as high as 99.99 per cent, the reliability of the equipment is only 60-70 per cent for 10,000 parts. China has to foster such engineering companies as ABB and Siemens, added Xu.

China must follow the principle of “doing something and not doing something”. “Doing something” means doing some key projects, for example, thermal and nuclear generating facilities. The newly installed capacity is expected to reach 600 million kilowatts by 2020, 90 per cent of the generating sets are homemade. China boosted two thirds of the newly added generating capacity in the world last year, but 90 per cent of the generators were imported. Currently, foreign large-scale generating facilities companies are rapidly marching toward Beijing with an aim of striving for a share in Chinese market. Unfortunately, domestic companies cannot compete with them.

Additionally, China should pay more attention to the new generation of packaged facilities and equipments. A large-scale steel enterprise with an annual output of 8-10 million tons will produce many industrial wastes if it follows the traditional techniques and flow. But under the new flow, the enterprise will not only take 14-28 tons of wastes as raw materials to promote the quality of steel, but also absorb 1.2 million tons of waste steel. Meanwhile, the enterprise will also generate 3 million kilowatts of electricity with by product cement.

Apart from that, digital and intelligentized design, extra large-scale integrated circuit, oceanic engineering equipment, key technology and clean-fuel autos should also be listed as key projects.

China Trade Deficit:

China is very likely to have a year-long trade deficit this year, the first since 1993.

While economists say that the possible trade deficit will mostly be caused by temporary factors, they recommend the government and industry players adopt measures to avoid the impact of surging imports.

Customs statistics released last week showed that China posted its third monthly trade deficit in a row in March. The deficit totalled US$540 million last month. For the first quarter, the deficit totalled US$8.43 billion.

China’s exports were 42.9 per cent higher in March, reaching US$45.85 billion, while imports rose 42.8 per cent to hit US$46.39 billion.

Exports in the first three months stood at US$115.7 billion, up 34.1 per cent from a year earlier, while imports were US$124.1 billion, up 42.3 per cent.

In the first quarter of 2003, China also had a deficit of US$1 billion, but this time, things are different.

“The trend of slower export growth than import is expected to continue in the second quarter, causing more deficits, and the situation will improve in the second half of this year.
The annual figure is very likely to be a slight trade deficit,?said Chen Fengying, a senior economist with the Institute of Contemporary International Relations.

Last year, China realized a trade surplus of US$25.53 billion.

But in the long term, continued trade deficits can hurt the Chinese economy which is mainly pushed by exports and investment.

An immediate problem of China’s rising imports is that the huge Chinese demand often spurs international prices of raw material to rise rapidly, Zhang said.

This is mainly because international prices of raw material are manipulated by traders in the developed countries, who are very sensitive to China’s rising imports and would not hesitate to increase the price of their commodities.

Economists say a measure to solve the problem is to avoid concentrated purchases of raw materials. Domestic buyers should buy oil, steel or coal at different times, in different markets and from different countries. More Chinese companies should be encouraged to invest in mines and oil fields in other countries, especially in Africa where resources exploration has not been totally controlled by giant international mining firms.

“As a whole, there is oversupply of raw material in the international market. As a big country and major importer, China should decide the price instead of passively accepting it”,said Zhang.

Souce: China international electronic commerce network