Several more major steel companies raised prices yesterday, virtually assuring the failure of the administration's attempt to keep the industry from following U.S. Steel Corp's pricing lead.
After U.S. Steel announced price increases last Thursday, the adminstration sharply lashed out at the raises, calling them excessive and not in keeping with the administration's attempts to hold down inflation. It is the fifth time since December steel companies have raised prices on one or more products.
Yesterday Armco Steel Corp., the nation's fifth largest producer, boosted prices on structural products and Wheeling-Pittsburgh Steel Corp. raised prices on tin mill products.
Last Thursday, U.S. Steel raised prices on tin mill products by 7 per cent and structural products by 6 per cent, both increases effective Sept. 4.
Despite heavy adminstration criticism, Bethlehem Steel Corp., the second largest producer, followed U.S. Steel's lead Friday.
Yesterday's price action removed almost any hopes that the latest steel industry price rise can be averted.
Armco, based in Middletown, Ohio, does not make tin mill products, which are used in making beverage containers and tin cans, while Pittsburgh-based Wheeling-Pittsburgh does not make structural shapes used in heavy construction, such as manufacturing plants or bridges.
When it raised prices, U.S. Steel cited rising costs as the main reason for the increase. Administration econimists agree that steel making costs are rising, but say that demand is very weak for structural products and the market cannot justify an increase.
While demand for tin mill products is stronger, steel makers raised prices on these products just last March.
In the aggregate according to Charles L. Schultze, chairman of the President's Council of Economic Advisers, steel prices will be 12.5 per cent higher than a year before if tin mill and structural product prices take hold as scheduled, an inflation rate far in excess of the 7 per cent registered for all industrial products.