STEEL: Roy Berlin, president of Hammond-based Berlin Metals

Steelmakers are having a very good time right, said Roy Berlin, president of Hammond-based Berlin Metals, whose company is a steel product distributor, service center and slitter.

"The steel manufacturers have undergone a period of consolidation that resulted in four companies (U.S. Steel Corp., ArcelorMittal, Nucor and Serverstal N.A.) which are 70 percent of U.S. production," he said. "That consolidation certainly helps them fight off low-ball pricing from competitors who want some production. There's now more discipline in their market."

The relatively low value of the U.S. dollar and weak demand in some the auto and housing sectors are keeping U.S. steel prices lower than in off-shore markets, which induces exports and reduces imports, Berlin said.

"As a distributor heavily involved in home construction and automotive our demand from the companies that eat steel -- steel consumers -- is down 7 to 8 percent from last July 2007," Berlin said. "... The demand is still strong for plate for infrastructure, and in pipe and tube for the energy markets, which are doing well."

He predicts nonresidential construction projects -- hotels, office buildings, strip malls -- will fade as credit tightens.

"The funded projects will continue, but new projects will have problems getting funded," he said. "People are hopeful that government sponsored projects -- road and bridges construction -- will remain strong."