Forgers participating in the 2014 FORGING Business Outlook Survey were split in their assessment of the past year’s operating conditions. The latest report of forging shipments during 2013 reconfirms that assessment. The Forging Industry Association released the results of its U.S., Canadian, and Mexican members’ 2013 shipments, documenting what was a no-more-than-modest result for producers of impression-die forgings and seamless rolled rings, and a truly poor outcome for open-die forgers.
Analysis of current conditions are more encouraging, and forecasts suggest there are growth opportunities, but the record for 2013 is one that gives forging producers much room for improvement.
According to FIA’s figures, total shipments for North American custom impression-die (i.e., closed-die) forging sector came to $7,313,261,000 in 2013, a decline of 0.3% from the adjusted total for 2012, $7,336,853,000.
New orders for impression-die forging orders increased during 2013, up 7% to $7,123,978,000 from 2012’s result, $6,670,024,000.
The largest percentage of those orders came from automotive (passenger cars, light trucks, SUVs) manufacturers and their suppliers, who accounted for 30.9% of all orders —10% more than their 2012 share, FIA reported. Commercial aerospace manufacturing represented the second-largest bloc of buyers for impression-die forgings, taking 20.7% of the market in 2013.
Total shipments of open-die forgings in 2013 declined 15.4% from 2012, down to $1,841,283,000 from $2,177,842,000. Orders for open-die forgings also fell, down 6.4% to $1,778,473,000 from the $1,899,092,000 recorded during 2012.
The highest level of demand for open-die forgings came from the oil-and-gas field machinery, whose orders represented 22.4% of that sector’s bookings. Defense — including military aerospace manufacturing, military heavy vehicles, ordnance and guided missiles, and naval-related and naval nuclear systems — held second place with a 15.1% share of the open-die forging sector’s new orders.
Deliveries of seamless rolled-ring forgings increased to $1,604,044,000, up a mere 0.02% above 2012 delivery total of $1,603,572,000. New orders for of seamless rolled-ring forgings increased to $1,591,131,000 in 2013, a rise of 3% over 2012's $1,537,735,000.
The commercial aerospace sector accounted for 48.3% of the demand for seamless rolled rings, in 2013, followed by the oil-and-gas field machinery and equipment sector, which had a 12.0% market share.
Forgings represent critical, high-value parts for most of the large-volume manufacturing and industrial sectors in the global economy, so the middling results of the past 18 months might have been expected to be borne out in the final data. FORGING readers, at least, seemed to know it at the time. Last year’s survey respondents also indicated a bit more optimism for 2014 business conditions.
Some of that optimism will be rewarded by a new manufacturing market survey. Global Industry Analysts Inc.’s latest issue takes on forging and other products essential to durable goods manufacturing and concludes there will be steady demand for such components for the foreseeable future.
Recovery is visible in global purchasing managers' indexes (PMI), the analysts contend, are which is spurring new investments in production machinery and parts, thereby benefitting the market for forgings (as well as castings and metal stampings.) The global manufacturing output expansion of the past year, “largely due to the recovery in demand and trade in countries such as United States, Japan and Germany,” according to the analysts, demonstrated this. PMI indices in other European countries also are rising, they write, supported by a “fragile recovery” in the EU.
The real strength for global economic expansion will be seen in China, India, and other developing countries in the Asia-Pacific sphere, including Taiwan, Singapore, South Korea, and Indonesia, among others where manufacturing demand continues to increase.
As a mid-term report, the Global Industry Analysts market study is useful (and hopeful) examination of current business conditions, and one that provides better reading than the lackluster data in FIA’s final summary of forging deliveries and orders for 2013.