BELTING MARKET FEELS ASIA PINCH
By Staff -- Industrial Distribution, 9/1/1998
Asia's economic woes and the General Motors shutdown slowed belting sales as the third quarter began."I think there's been a slight leveling off toward the end of the second quarter," said Richard Womack, president of the National Industrial Belting Assn. and eastern regional manager of Flexible Steel Lacing Co. in Grand Rapids, Mich. "But on the whole, year-to-date, it's still been strong. Manufacturers are still running pretty near capacity."
NIBA executive director Charles Blanchard and several distributors said orders for conveyor systems kept steady, reflecting continued growth in key heavy materials industries. "The way we see it is the economy is still real strong," said Blanchard. "Sales are still equal to or better than the year before."
Slumping Asian export markets have hurt manufacturers and some distributors, however. Womack said North American-based coal companies that do a lot of business in the Far East were renegotiating contracts or faced delays, for example.
"That's starting to impact heavier utility belts," he said. "It's a trickle-down thing because we're selling to coal companies...that are into the steel industry, particularly in Asia. We see an impact."
Meanwhile, the shutdown of most GM plants across North America dampened the sales of both light and heavy-duty belting through mid July. Womack said GM suppliers such as foundries were cutting back on orders. The country's overall industrial output dropped in June more than in any month the past five years, which analysts attributed mostly to Asia's problems.
Belting revenues continue to climb for some distributors, meanwhile. "Ours are up and I think the strength of the economy as a whole is really what's driving it," said Carl Covin, president of Industrial Rubber Products, Inc. in Houston, Tex. The company recently relocated two branches to larger, improved facilities.
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