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Monday | 22 December, 2014 | 1:49 pm

Better mousetrap

By Corinna Petry

Above: NDM has a total of five coil-to-bar draw lines, some of which undergo eddy-current testing in process.

The SBQ market faces potential capacity overload but the product allows purveyors to find their niches

December 2014 - A small cold drawn steel bar finishing operation might easily fly under the radar in a market that has so much going on. Hot-rolled bar producers have increased melting, rolling and forging capacity. Some steelmakers are switching production to make more semifinished product that is converted into seamless pipe. Some have improved their casting technology or built new heat treating equipment. Some are putting new sources of iron units into the furnace.

The overriding goal of these efforts is to climb up the value chain to serve today’s most demanding end-use applications.

New Dimension Metals Corp. (NDM) does not wish to compare itself with the large cold drawers and bar distributors, names known to all. Yet it is climbing up the value chain while carving out a niche in the special-bar quality (SBQ) market by integrating certain operations—heat treating, laboratory testing and trucking, for exampleMM-1214-bar-image1—and by being flexible so that it can guarantee without fail the utmost quality will be delivered to its customers, says Executive Vice President Randy Fox. 

Gray America Corp., NDM’s Dayton, Ohio-based parent, also owns A-Lab Corp., a metallurgical testing laboratory; L & H Threaded Rods Corp., which makes truck and trailer U-bolts; and Scarlet & Gray Corp., a contract carrier. Founded by John C. Gray in 1978, the parent employs 163 employees across the four divisions.

NDM has grown in large part because customers that get shut out of mill schedules or that are ignored by high-volume cold drawers and service centers are placed at the front of the line at NDM.

It processes all grades of carbon and alloy round bar from 5⁄16- to 4-inch-diameters, hexagons up to 2.5-inch-diameters, as-is squares from 7⁄16 to 2 inches, and flat bar from 0.5 by 1 inch to 0.5 by 4 inches. 

“The product range fits medium to large screw machine houses’ needs and the same range is sold to large distributors that service the same industry,” Fox says. On inventory, “we are probably north of four turns a year. We offer stock-and-release programs, stock common items and stock special inventory for consignment customers.”

Supplier relations

New Dimension buys hot-rolled SBQ from all major domestic producers and some foreign suppliers. Some vendors had issues with late deliveries this year. “We suffered like everyone else trying to get material but we work with vendors on delivery issues and our business model makes it easy because we will often pick up our own steel. We ship into most Midwest markets daily so we will haul back as much steel as we can,” Fox adds.

Draw bench prowess 

NDM operates a large McKay bench and five Combined Drawing Machines. “A CDM draws, shears and straightens the bar all in line,” says Fox. “Other services include heat treating, chamfering and facing. Turning and grinding jobs are outsourced.”

The company recently installed a Schumag IB and a Schumag IIB, “bringing us to a total of five coil-to-bar draw lines.” Both new Schumags can eddy-current test rounds and shapes in process. There are three additional bar processing lines, each producing material “for the increasingly demanding applications our customers require,” Fox says. 

NDM supplies pieces to specific lengths or longer multiple lengths to provide maximum yield.  

“We perform close-tolerance piece part cutting; the end products are pins and shafts for the trailer industry. We also manufacture king pins used in landing gears,” Fox says. 

NDM makes threaded rods and U-bolts for its sister company, L&H Threaded Rods Corp., also in Dayton. The finished products are used to fasten parts in mobile and stationary heavy equipment.

Through another sister company, A-Lab Corp., NDM has an on-site—yet independent—metallurgical laboratory partner that performs magnetic and ultrasonic testing to verify drawn and cut material meets customers’ mechanical, physical and chemical specifications. Turning and grinding work is outsourced, according to Fox. 

Packaging & logistics

New Dimension performs quite a bit of special packaging, says Fox. “We do some piece counts. We stretch wrap in protective paper wrapping. We will build a crate, wrap your order in Tyvek paper, and load it on the truck the way you want it.”

Outbound, anything in stock can be delivered in 24 hours within a 200-mile radius. “If you want a grade 12L14 bar at standard length, it will be shipped immediately. But if you need it saw cut, chamfered or heat treated, the value-added processing means a longer lead time. The size of the order matters: It’s easier to load 4,000 pounds versus 40,000 pounds. We go to the Chicago market Mondays, Wednesdays and Fridays.”

Fox declined to divulge how many tons of steel New Dimension ships per year but he stresses it’s not about volume but about service and quality. “If you want the steel loaded on a rear axle at 9:45 a.m., if you want small bundles, short lengths, you got it. We are responsive.” 

That is sometimes difficult in an environment where steel producers prefer to manage easy commodity-sized orders. “But it’s not all about the volume. We love small business and we take care of those customers. Everybody wants to sell [to big customers], but there are a lot of companies making small parts and cannot carry inventory and cannot buy truckload quantities of one size bar,” Fox explains. “I don’t have half a million tons a year, but we participate in the same arena as those who do.”

He cites a customer who ordered 20,000 pounds of cold drawn bar and needed it immediately. If the client ordered the material elsewhere, he would have had to pay the freight for a full truckload and still not get it the same day. “You’re still at the end of the line. The customer remembers having to pay extra freight.”

MM-1214-bar-image2

NDM will give loyal clients every benefit of a doubt. “We have a lot of customers that in 2008 got into trouble [paying bills] but we stayed with them. It’s still a people business,” Fox says. It helps that the company is private and can manage its finances in a way that “we don’t live and die in 30-day increments.”

The company, privately owned by Gray America, which apart from the other holdings previously mentioned, also runs a small trucking firm, is integrated for a reason. 

“What makes us unique is that we have the mousetrap. We control the cold finishing, the testing, the shipping—which means we get it right every time. If we don’t there’s no discussion, no outside party to blame. We are embarrassed and we fix it,” Fox says. 

Modernization mode

During 2014, New Dimension has upgraded its heat treat furnace in pursuit of continuous improvement and automotive heat treat certification. The newest Schumag cold drawing line came on line during second quarter. A new Tsune precision saw was installed during third quarter. All eddy-current surface testers are being upgraded to the latest technology.

“We invested capital in our buildings, cranes, housekeeping. We have new shotblasters, new payoffs to load material into draw benches. We are installing in-line chamfering and unloading capabilities. We invested in our own fabrication and now fabricate our own parts, like gears and rollout tables,” says Fox. And, instead of going to machine shops, “we have our own machine shop for tooling and dies.

“We are starting to invest in building a stand-alone sawing center. We will have no problem selling overflow [capacity] for other sawing operations,” he predicts. 

Market dynamics

Much concern has been expressed about the potential for excess domestic production of SBQ products, even as cold-finished bar imports rose 17.9 percent through September versus last year. 

“We believe the market will be in oversupply territory when the mills fully come on line with their new capacity,” Fox says. “But the steel industry is always about what could be. For example, during my whole career it’s been said that if just 5 percent of the housing market goes to steel studs, there would not be enough galvanized to cover demand. It still hasn’t happened,” he muses.

NDM lives in the now, Fox continues, and the SBQ market “is a good place to be. There is always a market for precision machined products and highly technical applications. We will always have heavy equipment and vehicles made in the United States, and the emergence of a Mexican and South American auto industry,” he says, is encouraging. I don’t think the U.S. SBQ industry has anything to worry about.” MM

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