[Congressional Record Volume 150, Number 31 (Thursday, March 11, 2004)]
[Extensions of Remarks]
[Pages E339-E340]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    SPIKE IN METAL PRICES--WHAT DOES IT MEAN FOR SMALL MANUFACTURES

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                         HON. LINDA T. SANCHEZ

                             of california

                    in the house of representatives

                       Wednesday, March 10, 2004

  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, today Chairman 
Manzullo and Ranking Member Velazquez held an important hearing for the 
small business. The hearing focused on the increase in steel prices.
  Consumers of Steel expected that the removal of the tariffs by 
President Bush in December would decrease the price of steel and 
increase steel imports. However, this did not happen. For the past 2 
months the price of steel has increased approximately by 30 percent.
  The continuing increase in steel prices affects many parts of the 
economy, but particularly small manufacturing companies who buy their 
steel at market price. These small companies have not only been dealing 
with the increase in steel prices, they are now facing shortages in 
steel products. With these factors combined, it is virtually impossible 
for small manufacturers to survive.
  I would like to share a story of a constituent of mine who has been 
dealing with this crisis. Argo Springs Manufacturing Company, located 
in Norwalk, CA, is a family company that has been in business for 
almost 40 years. They produce numerous products from springs to 
compression coils. Their customers range from the commercial and 
aerospace industry to military agencies.
  Argo Springs currently employs 70 people, but with the sudden 
increase in prices and shortages in steel, it has become difficult for 
the company to compete in the manufacturing market. Randy Fox, vice 
president of Argo, told me and I quote,

       On February 15, I bought steel at 34 cents a pound, but by 
     March 2 the price of steel had increased by 59 cents. I am 
     worried that the company will have to start laying-off 
     workers and eventually go out of business. I'm not sure the 
     company will outlast the crisis.

  This story highlights the true impact of this crisis on small 
business owners. I am worried that if this crisis is not resolved, many 
small manufacturing companies like Argo Springs will not be able to 
continue doing business. This is unacceptable.
  After talking to my constituent, Randy Fox, one thing is apparent to 
me--we need to do something about this crisis in the steel industry. 
Small businesses are the economic backbone of our Nation. It is 
imperative that we

[[Page E340]]

create a viable and reasonable economic environment for them to 
maintain their businesses and grow.

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