President and CEO David Higbee blamed "surging imports and the continued depression in the market for steel products."
"Foreign imports of standard pipe into the U.S. market, which increased by over 51% last year, grew to even higher levels in the current year," said Higbee. "According to AISI data, foreign imports now account for about 60% of the U.S. standard pipe market in our size range. The impact of these imports on our order volume has been devastating. Shipments in fiscal year 2001 were off by 17% compared to the (prior) plan of reorganization and by 21% compared to the prior year. Sales dollar volume was down even more, reflecting the downward pressure on pricing."
Higbee noted that 18 domestic steel companies have filed for reorganization and six have shut down operations, while another five have curtailed steel production and other bankruptcy filings are rumored.
Laclede's president took note of President Bush's enactment in May of a Section 201 investigation of foreign steel dumping in the U.S., but cited Laclede's lack of financial reserves to "stay the course until better times arrive."