Above: Northlake Steel’s customers are being cautious and moderate, partly due to increased costs from tariffs.
May, 2025- Founded in 1977, Northlake Steel Corp., Valley City, Ohio, has a team of veteran leaders and employees who are well versed in the volatility of the steel market. The year 2025 may present the most challenging environment in a very long while.
Bill Bissett CEO, says that recent data indicates that domestic raw steel production was in decline during first quarter compared to the same period last year, suggesting that facilities are operating at slightly lower capacities. “Such a reduction in capacity utilization often points to either cautious production planning or softer demand from downstream sectors.”
He finds that Northlake customers are being cautious and moderate, partly due to increased input costs from tariffs and ongoing uncertainties in global trade. “This caution translates into smaller or delayed orders as businesses adjust their investment and inventory strategies.
“Many companies that were more aggressive in ordering steel a year ago are now holding back, leading to a more measured pace in production and consumption,” he adds.
Industry surveys and word of mouth conversations with steel buyers and sellers suggest that while the downturn “isn’t drastic, there is a clear moderation in order volumes relative to the peak recovery levels seen two years ago,” Bissett says.
INTERNATIONAL TRADE
“The whole idea of tariffs is to bring business back here. What this is doing is leveling the playing field. No finished bar is being brought in from Europe that sells for less than we can sell it for. So this is actually good for us,” Bissett says. Bissett was among several members of the Cold Finished Steel Bar Institute who went to Capitol Hill in late March to meet with their representatives. They sought to ascertain whether tariffs on Canadian and Mexican imported steels were going to be sustained longer term.
“This is the most interesting time our company has experienced in 48 years. Our concerns are elevated costs and availability. Can we buy steel from Canada? We brought in 500 tons two weeks ago [early March], but we have no such orders on the books now.
“If I cannot get all our feedstock domestically, the U.S. mills will have to ramp up. I talked to some bar mills directly, and I cannot get a concrete answer. It’s all speculation. It’s a catand-mouse game to figure out how high it can go.”
Northlake cold draws bar up to 6 inches, and makes turned and ground through 16 inches in diameter and up to 75 feet long.
Meanwhile, one customer in March had placed an order for cold-finished bar originating in Canada, but then directed Northlake Steel to “hold off three to four weeks to ship even though pricing will go up [via surcharges] but they were waiting and hoping for negotiation that will eliminate the 25 percent tariff.”
Bissett notes that the domestic producers do not have full order books for second quarter, and there has been no change in lead times. Eventually, “the domestic mills will start getting more orders because sources are shrinking. I am quoting more business with domestic mills so they should get busier” as 2025 progresses.
“We are fully stocked, because it is a guarantee that prices are only going up,” says Bill Bissett.
CUSTOMER RESPONSE
Frankly, “the customer doesn’t want to pay 25 percent more on imports, and neither do we.” For many customers, Bissett says, “it’s all about price, price, price with quality and availability next—except for critical products that cannot be gotten elsewhere. We tell customers to get their inventory stocked today. We are fully stocked, because it is a guarantee that prices are only going up.”
Northlake Steel, he notes, has a vast range of cold-finished products and specializes in larger diameters: cold-drawn bar up to 6 inches, and turned and ground through 16 inches in diameter and up to 75 feet long.
“We can serve every market with our products. It gives us a more diverse customer base and more places to sell it. Our customers appreciate our quality—the way we handle it. We don’t receive rejects for quality. The only reason might be that someone dropped the steel off a truck.”
OFFERING VALUE
If the higher tariffs stay in place, the rate will merely establish a new price range that reflects that in domestic supply. “In cases where we have a product no one else makes, they have to come to us anyway. The value is there and it is not as much of a commodity,” Bissett explains.
At the end of the day, “business will happen. Every customer will be different, every product will be different.” And those differences help define the market.
The bar producer is in the process of adding two more cold drawing lines.
ADDING CAPACITY
Northlake Steel is in the process of building a 20,000-square-foot addition, in which it will install more cold drawing and material handling equipment.
“We already cold draw from 1 to 6 inches and we are putting in two lines to process bar 2 inches and less.” Bissett concedes that there are a lot of companies making cold drawn bar, more on the small-diameter range, as well as those running coil-to-coil and coil-to-bar lines. “Small diameter represents higher volume,” because it goes into screws, nuts, bolts, fasteners, lawn furniture and more.”
The company’s new cold drawing capacity will be ready by the end of 2025.
Northlake Steel Corp., 800/966-1470, http://northlakesteel.com/
