DETROIT -- After nearly three months of decline, steel prices are on the rise again.
U.S. Steel Corp., a major supplier to the industry, last week announced plans to raise prices this month by $110 per ton.
That would push the price of hot-rolled coil steel, used for the underbody, chassis and frame, to $780 per ton. That is double its price in early 2003.
Cold-rolled steel, used for sheet and stampings, would rise to $845 per ton.
Fueling the increases are heavy demand and higher prices for scrap steel, a vital raw material for the production of new steel. Scrap steel prices rose from $156 a ton in December to $300 in March. Then prices dipped. But they began rising again in June, and in July they topped $350 a ton.
Steel prices are hitting some suppliers hard.
Wescast Industries Inc. blames rising steel prices as one of the reasons it is exiting its chassis components business in Georgia. The move, announced last month, comes just 22 months after Wescast of Brantford, Ontario, paid $70 million for Georgia Ductile Foundries LLC.
Wescast, a major supplier to Ford Motor Co. and the Chrysler group, has not said what it intends to do with the plant, which makes suspension parts. Calls to the company were not returned.
Wescast CEO Ed Frackowiak said in a statement that he would focus on the profitable exhaust manifold business.
Wescast is the world's largest supplier of exhaust manifolds. Sales last year were $476 million.
Wescast is not the only supplier hurting. Auburn Foundry Inc. of Auburn, Ind., a General Motors supplier, is struggling against high steel prices as it reorganizes its brake rotor and drum business under Chapter 11 bankruptcy protection.
The company has called on its union to help reduce contract and pension plan costs.