Industry Analysis & Industry Trends
Despite its abundance of natural resources and large quantities of iron ore, Australia has a small steel sector compared with other developed nations. The Iron and Steel Forging industry is characterised by a number of small companies that produce highly customised, low-volume forged products. The industry also includes a few large companies that produce grinding media and wheels and axles for rolling stock.
Forging iron and steel is a method of shaping the metal. Unlike cast iron and steel products, where the metal is heated to its melting point and then poured into a mould, forging involves applying pressure to the metal and bending it into shape. Forging generally produces stronger steel components but is more difficult to perform on larger items... purchase to read more
Industry Report - Industry Investment Chapter
The Iron and Steel Forging industry has a medium level of capital intensity. For every dollar spent on capital, a further $6.46 is spent on labour. Forging requires highly customised equipment that generally comes with hefty price tags. Useful life of this equipment generally extends beyond 15 years and depreciates at a relatively slow rate.
Capital intensity generally varies across operators. Smaller operators that cater mainly for small jobs generally have a low level of capital intensity. Players with small-scale operations tend to require simpler and less-expensive equipment in their production. Operators producing larger volumes may have more automated systems in place and will invest more into their capital for each unit of labour... purchase to read more