Key Facts & Statistics in the U.S. Primary Metals Industry

4 MIN. READ

The U.S. primary metals industry is a cornerstone of manufacturing, driving innovation and economic growth across various sectors. This dynamic industry encompasses companies that transform raw materials into essential metal products, providing the foundation for countless applications in construction, automotive, aerospace, and beyond.

In this article, we will explore the key trends shaping the primary metals industry today. From the number of active companies and employment statistics to annual sales and export figures, we offer a comprehensive overview that highlights the sector's vitality.

Key Facts & Statistics in the U.S. Primary Metals Industry

According to MNI, compiler and publisher of the industrial data that powers IndustrySelect, the U.S. is home to 6,220 primary metals companies, providing 486,161 jobs. Employment in the sector rose 1.6% in the past year (August 2023-August 2024). The industry has an average yearly total sales of $411 billion and its international distribution for this manufacturing sector is 35%. This is higher than manufacturing as a whole, which comes in at 29%.

Primary metals companies import more raw materials, 17% versus 11% for manufacturing in general. This difference follows from the fact that primary metals provide other industries with raw materials. Minority ownership matches that of all manufacturing at 1%. However, only half the percentage of primary metals companies are woman-owned as compared to manufacturing as a whole—1% versus 2%, respectively. Public ownership in the primary metals industry is relatively high, at 14% compared to 5% for all manufacturing.

Primary metals manufacturers cluster in the Midwest at 38% and the South at 29%. Large manufacturing segments, such as automotive, form a ready customer base in these regions. You will also find 19% of primary metals producers in the Northeast and 13% in the West. Regardless of location, these companies require basic supplies and services such as IT, staffing, and finance. Suppliers can approach the various subindustries with these needs in mind.

Primary metal manufacturers smelt or refine metals. These companies work with both ferrous (iron) and nonferrous types. They refine them from ore, pig iron, and scrap metal. If you were to tour the production facilities, you would find processes based on the use of electricity, chemicals, or both. These manufacturers also make alloys composed of various combinations of metals.

The initial products are ingots, the type of shapes you might picture being stored at Fort Knox. Ingots can be drawn, rolled, or extruded into other forms, including:

● Sheets.
● Strips.
● Bars.
● Rods.
● Wire.

Ingots can also be melted to make castings. Other manufacturers fabricate an almost unlimited array of products from these basic forms.

Understanding Primary Metals Subindustries

During the pandemic, primary metals were considered a critical manufacturing sector. Subindustries producing iron, steel, aluminum, and other nonferrous metal products remained in action. They continue to play a vital role in manufacturing within the re-opened economy.

Blast Furnace and Basic Steel Products

These companies anchor the steel-producing process, producing the wares other companies need for their operations. Unfortunately, high costs and environmental challenges threaten their existence. Sales forces attempting to form a relationship should be aware of the potential challenges ahead.

Iron and Steel Foundries

This subindustry covers a lot of ground. In addition to smelting and refining, it also produces castings and other metal products such as nails and cables. These companies may also produce coke, a specially treated coal used to make steel.

Primary and Nonferrous Metals

Predictions have the global market for these products reaching $1.5 trillion by 2028. The automotive and construction industries drive demand. These metals have many desirable properties, including lighter weights and ductility. This growing subindustry can present you with a healthy market for both goods and services.

Nonferrous Rolling and Drawing

This subindustry manufactures many products. However, you might wish to focus on its production of battery metal. As the demand for batteries rises, the fortunes of this subindustry may rise with it. You can go along for the ride.

Miscellaneous Primary Metal Products Such As Metal Heat Treating

This subindustry excludes castings and stampings. Still, you can find its products, everything from metal hair curlers to metal safes, all over store shelves. By choosing manufacturers of popular items, you can scope out a richer prospecting field.

Nonferrous Foundries

These foundries produce castings. They may use a variety of metals, including:

● Beryllium
● Magnesium
● Lead
● Antimony
● Tin
● Zinc
● Aluminum
● Copper

The foundries' products are vital to many industries. The most lightweight metals find applications in aerospace. These companies also sell castings for metal machinery. With its products' wide range of uses, this subindustry offers sales opportunities more apt to weather fluctuations in specific industrial markets.

Outlook and Challenges for the U.S. Primary Metals Industry

Researchers tracking the movement in the primary metals industry identify five elements to watch. The first, as cited in descriptions of the subindustries, is the increasing push toward sustainability. Manufacturers are implementing solutions that address two problems simultaneously: minimizing environmental impact and dealing with scarcity. Recycling materials and thus reducing waste achieve victories on both fronts. Gaining a reputation as a green company also improves its brand image. If you offer products or services that aid in primary metal recycling, you have customers waiting.

The second element is technology growth. Primary metals producers are increasingly investing in digitization, data analytics, and robots. If you deal with any of these, these companies provide sales opportunities.

The third element is developing procedures to deal with supply chain disruptions. Any solutions you offer for minimizing the problem should be welcome.

The fourth is a positive trend. Clean energy technologies use a lot of metals. As their use grows, the demand for primary metals will mushroom. While a great problem to have, companies will still have to adapt. They will need services to help them do so.

The fifth is the ever-present specter of evolving regulations and policies. These apply to climate change, labor law, and trade restrictions. Metals manufacturers will be dealing with threats to their reputations and bottom lines. A consultant who can keep companies up-to-date and in compliance will have many potential openings to explore.

The primary metals industry faces challenges on many fronts. Addressing these pain points will open the door to numerous sales opportunities.

Emerging Trends in the U.S. Primary Metals Industry

Clean Energy Demand: The push for clean energy has significantly impacted the primary metals industry. Federal tax incentives, such as those from the Inflation Reduction Act, have led to a surge in utility-scale clean energy installations. Solar and energy storage projects are particularly notable, driving up the demand for metals like aluminum, copper, and steel. These materials are essential for constructing solar panels, wind turbines, and battery storage systems. This trend is expected to continue as the U.S. aims to meet its renewable energy targets and reduce carbon emissions.

Legislative Impact: The upcoming U.S. elections could bring changes to key legislation affecting the primary metals industry. The Bipartisan Infrastructure Law and the Inflation Reduction Act have already provided substantial support for infrastructure and clean energy projects. However, potential revisions or new policies could alter the landscape. For instance, changes in environmental regulations, trade policies, or tax incentives could impact production costs, market demand, and overall industry growth. Stakeholders are closely monitoring the political climate to anticipate and adapt to these changes.

Tariffs on Imports: There are ongoing discussions about reinstating tariffs on inexpensive metal imports from countries like Mexico. These tariffs aim to combat foreign dumping, where countries export metals at prices lower than their domestic market value, undermining U.S. producers. By imposing tariffs, the U.S. government seeks to protect domestic manufacturers, ensuring fair competition and supporting local jobs. However, these measures can also lead to higher costs for downstream industries that rely on imported metals, creating a complex balance between protectionism and market efficiency.

Price Trends: In 2023, import prices for primary metal manufacturing decreased by 6.6%, following a period of significant price increases in previous years. This decline reflects broader economic trends, including fluctuations in global supply and demand, changes in raw material costs, and shifts in trade policies. Export prices for primary metals also saw a decline, indicating a competitive international market. These price trends are crucial for industry stakeholders, as they influence profitability, investment decisions, and strategic planning.

Connecting with U.S. Primary Metals Manufacturers

You may have the perfect product to address a primary metals producer's woes. Your problem is finding the right set of eyes and ears to pitch. Help is at your fingertips. The Primary Metals Industries Industrial Database available through MNI's lead software program IndustrySelect provides company profiles and contact information to reach decision-makers. Interested in other industries? MNI has them all, from food production companies to automotive firms to plastics manufacturers. You can even build your own database, based on your unique criteria. Start with a free demo account, loaded with 500 real company profiles and see how easy it is to make contact.