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November 2004
Gentle breeze powers PM post Vienna
With total attendance hovering around the 2000 mark including
a core of 1200 delegates and 450 exhibitor staff, the PM 2004
World Congress and Exhibition is being rated as one of the
most successful ever...
The benignly positive atmosphere that pervaded the Austria
Centre during last month's PM 2004 World Congress and Exhibition
in Vienna was reflected in some of the global statistics deployed
by the European Powder Metallurgy Association's President,
Cèsar Molins, during his plenary glance at prospects
for PM. While powder shipments for PM applications had risen,
reaching around 880 000 tonnes in 2003, the percentage breakdown
by area was interesting.
Dr Molins’ pie chart showed the usual approximate 50
per cent share going to the United States, but the other half
of the pie is no longer divided overwhelmingly between Japan
and Europe. The "Other" category really has become
visible, with its estimated share of the market standing at
around 18 per cent, about the same as Europe and rather larger
than that of Japan. So who is Other? The obvious answer is
China, but while it is true that the booming Chinese economy
has been the most visible factor in the recent past, the slightly
lower profile of Korea and other Asian players such as Thailand
should not be ignored. Nor should the emerging economies of
India, Russia and Iran, countries whose profiles are set to
take on a dramatically enhanced edge in the short term.
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Global Powder Shipments for PM Applications
2003 - Estimated 880k tonnes
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PM activities in India date back more than half a century
and the industry produces a comprehensive range of powders
and products. Forecasts predict production levels of around
10 000 tonnes of manufactured products this year, split roughly
2:1 across transportation equipment and electrical machinery
and around 17 per cent up on 2003. Academic activities take
place in 15 institutions and research centres across the country.
The Iranian industry is younger, dating back to around 1990,
but has a strong academic base at the Univer-sities in Tehran,
Mashad and Isfahan. The 2500 tonnes manufactured parts production
forecast for this year represents an increase on 2003 of approaching
50 per cent. Car production, a major PM customer in Iran,
is accelerating steeply.
Russia produces a very wide range of powder materials and
has a long history of involvement in powder metallurgy. Powder
production includes more than 7000 tonnes each in the ferrous
and non-ferrous categories along with substantial amounts
of hard and refractory metals - tungsten (3000 tonnes) and
molybdenum powders (1500 tonnes). Around 70 per cent of Russia's
copper-base powders are exported to the EU.
In Europe, as in the US, the automotive industry is an important
PM customer and while the average weight of PM parts per car
continues to increase, the rate of growth is quite slow. That
could see quite a dramatic change as the newer semi-automatic
gear boxes pioneered so successfully by the likes of Audi
gain popularity.
US experience in gearbox and drivetrain economics shows that
PM has distinct commercial advantages in some areas. The continuing
rise of the diesel and the number of vehicles using variable
valve timing are also seen as positive developments for PM.
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Market Developments: Average Weight of PM
parts per European Car
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Market Developments: Forecast sales of Automatic
transmission in Europe (Source KGP/JDP)
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Dr Molins concluded that although there had been some recovery
in Western Europe, it was the economies of the newer EU members
in the east that had growth potential. Soaring scrap prices
this year had been shadowed by increased electricity and fuel
costs. Steel scrap prices have faded from their mid-year peaks
as China's economy has slowed, but it is unlikely that they
will descend to the $150 a tonne levels of late last year.
And just to complicate matters further, some aluminium powder
producers have been forced to impose surcharges because of
supply difficulties caused by tightening supplies. The Caribbean's
"Hurricane Summer" has been blamed for disrupting
supplies, especially from Venezuela, but increasing electricity
and fuel prices are also major factors.
Principal factors -
materials and energy
Materials
• Metal Powder costs are between 10 per cent and
30 per cent of total costs in West European plants;
on average, 20 per cent.
• Price increases in the first half of 2004 were
around 5 per cent, and up to 10 per cent in the second
half; average 7.5 per cent.
• The overall cost impact is therefore 1.5 per
cent.
Energy
• Energy costs are between 4 per cent and 7 per
cent, including industrial and natural gases. Average
applicable energy cost is assumed to be 5 per cent.
• Actual offers show that new electricity contracts
will be 20 per cent more expensive than last year. The
result is an overall cost impact of 1.0 per cent.
Total overall cost impacts are roughly 2.5 per cent.
Source: Fachverband Pulvermetallurgie
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