Friday, November 26, 2004
Indiana economic development - Steel, coal and power plants, and auto parts
Steel mills. "Steel still reinventing itself after 150 years: Industry changes result in better products, profits, more secure jobs" is the headline to this story today in the Munster Times. Some quotes:
Steel products are continuing to evolve from rusty to revolutionary at a time when U.S. steel production and consumption are reaching record levels despite industry consolidation and work force reductions.Coal and power plants. Earlier this month the ILB posted an entry quoting from an AP story headlined "State in running for coal plants." It related that both American Electric Power and Cinergy/PSI are looking at several states for new coal gasification plants, which they say are needed to meet growing electricity demands. I was reminded of the story yesterday when I read this enthusiastic opinion piece from Wise County, Virginia - some quotes from the beginning of the piece:
The 150-year-old American integrated industry has reinvented itself during the past year as a modern manufacturing marvel with fewer larger companies producing more steel and more profits, while employing fewer workers and more technology to make the cutting-edge steel required by the industries buying its products. * * *
In Northwest Indiana -- the heart of the integrated industry where steel is made from raw materials -- steel plants are operating 24/7. Ownership changes at three of the area's five megamills triggered new labor agreements, which have allowed payroll numbers to fall to about 19,000 steel workers, down from 24,500 workers in 1999.
Although production is steady, the region is producing a record amount of steel per worker. At about 2.2 million tons a month, the region's current raw steel production is about the same as it was in 1999, according to statistics provided by the American Iron and Steel Institute.
Virginia City, Va. --- Electric power generation has been a hot topic among economic development officials throughout Virginia coal-producing counties with visits by utility executives to proposed sites in Wise, Lee, and Dickenson Counties with hope for an investment upwards of one billion dollars over the balance of the decade.This recalls my characterization in an entry yesterday about differing perceptions: "economic blessing" vs. "environmental threat".
Saint Paul's Mayor Jack Kiser has been touting location of a coal-fired electric utility in the Virginia City section of Wise County which was recently annexed into the Town of St. Paul.
"Location of a one-billion dollar plus utility plant would lead to the most significant investment in Wise County's economy since the discovery of coal in the 19th Century," noted District One County Supervisor Ronnie Shortt while lavishing praise upon federal and state officials who are touting the region for energy plant investments.
Virginia City has the necessary ingredients: a large water supply from underground coal mines and the Clinch River; large coal reserves are available throughout the coal-producing region; several hundred acres of real estate served by NS Railroad and U.S. 58-A four-lane highway; and, local government support at the municipal, county and state levels.
If a utility were sited at Virginia City, the coal-fired electric generating plant construction would bring significant short-term construction jobs with a long-term contract demand for local coal production and long-term coal-mining jobs. Electrical engineers would be in demand over its expected life. Many regulatory and environmental approvals would be necessary from state and federal agencies over years of planning, however.
Auto parts. Today's Wall Street Journal (paid subscription required) has a front page story headlined: "Shopping for China: A Scourge of the Rust Belt Offers Some Hope There, Too -- Auto-Parts Maker Wanxiang Invests in U.S. Partners As Its Ambitions Expand." One quote:
Mr. Lu is swooping into the American rust belt and scooping up investments in hard-hit auto suppliers. Some of them are finding that the remedy for Chinese competition is an infusion of Chinese money, and a timely means to cut costs.
Posted by Marcia Oddi on November 26, 2004 01:12 PM
Posted to Indiana economic development