Industry Analysis & Industry Trends
After a period of heavy beatings, the Iron and Steel Forging industry is expected to emerge with a stronger and brighter outlook. Over the five years through 2013-14, industry revenue is estimated to decline at a compound annual rate of 2.3% to reach $857.4 million. Despite this, profit margins have been relatively healthy, which is mainly attributed to the ability of operators to pass on price rises to their clients. Despite the ups and downs in input prices during the past five years, many operators have been able to keep their margins positive.
As a producer of primarily intermediate products, the industry is at the mercy of the performance of its downstream buyers. A... purchase to read more
Industry Report - Industry Investment Chapter
The level of capital intensity in this industry is moderate. This means that for every dollar spent on depreciation, approximately $5.09 is spent on labour. The industry consumes highly customised equipment that generally comes with hefty price tags. Useful life of this equipment generally extends beyond 15 years and it therefore depreciates at a relatively slow rate.
Labour costs have been increasing, mainly due to the rise in average wages. Recent labour cuts in the industry also mean that the proportion of less-skilled labour in the industry has fallen, leaving only the more expensive and skilled labour in the industry. On top of that, the use of more advanced technology increases the need for qualified machine operators and engineers... purchase to read more