FROM COMPETITIVENESS TO COMPETITION - THE THREAT OF MINIMILLS TO LARGE NATIONAL STEEL COMPANIES

Minimill steel companies - relatively small, efficient producers that use electric furnaces to melt scrap or directly reduced iron ore - hav e steadily increased their share of US steel production from about 5% in 1970 to more than 35% today, forcing the closure of numerous integr ated facilities over this period. Although these minimills received a stimulus from weak scrap prices in the 1980s, their continued success is attributable to lower labour and capital construction costs and ste ady improvements in electric furnace and rolling technology. Minimills have not yet spread widely to OECD countries outside North America, b ut they are likely to emerge in these countries unless governments att empt to block them in order to protect their declining large, integrat ed steel companies. Copyright (C) 1996 Elsevier Science Ltd.