Skyrocketing Price of Steel Helps Position Plasticon for Major Growth
with Recycled Plastic Rebar Supports Product Line
Construction Companies Look for Higher Quality, More Cost-Competitive
Alternatives with Plastic Rebar Supports Instead of Steel Rebar Supports
7/27/2005 11:01:53 AM
LEXINGTON, Ky., Jul 27, 2005 (PRIMEZONE via COMTEX) -- Plasticon International Inc. (Pink Sheets:PLNI) announced today that the soaring price of steel will have a major impact on Plasticon International.
The rising trend in the price of steel over the last year and a half has had a significant impact on the construction sector and has been a hot topic in the industry. According to an article in the Miami Herald by Gregg Fields, "Steel is increasingly becoming a precious metal in the American economy. Thanks to a ravenous appetite for steel in fast-developing China, a rebounding U.S. economy, and a weak dollar, steel prices are rocketing upward and supplies are short."
An article in Inc. magazine noted that in 2004 the construction boom in developing Asian countries helped to drive up steel prices 46 percent. And The Florida Times-Union, in an article by Timothy Gibbons, reported that "last year, according to American Metal Markets, an industry trade publication, China imported more than $1 billion worth of American scrap, a world record. The country used more than 36 percent of rolled steel and half of the cement in the world, according to the People's Daily."
"We certainly believe that the rising price of steel is one of several major industry trends that is helping Plasticon achieve success with our plastic rebar support product line," Mr. Turek said. "Our domestic distributor, the largest building materials distribution company in the United States, has noted that demand has been increasing steadily. We believe that the dramatic rise in the price of steel over the last year and a half has made construction companies look harder at other options, rather than relying solely on steel products. And when they see what Plasticon has to offer, they realize that our innovative products are not only more cost-effective, our cutting-edge engineering also gives the end user a much better product, which is stronger, much easier to install, more versatile, and offers the most advanced design and engineering product line in rebar supports ever to be offered in the marketplace. Our products completely prevent spalling (corrosion damage) and prolongs the life of the structure. Together, these factors make our product offering a compelling proposition. So yes, I would say that the rising price of steel has been a boon to Plasticon International, because it really forces construction companies to do a more detailed assessment of the alternatives and then the demand has naturally increased for our products."
Mr. Turek cited Plasticon's relationship with R&S Manufacturing as a recent example of the direct impact that the soaring price of steel is having on Plasticon International and the industry. "R&S Manufacturing is one of the oldest and most respected names in steel post-tensioning cable, and they recently contracted with Plasticon to supply our plastic rebar supports to all of their post-tension cable customers," Mr. Turek said. "R&S recently increased their order by 50 percent, and in fact, they are exclusively supplying plastic rebar supports to their customers, rather than steel rebar supports. The soaring price of steel certainly has something to do with this, in addition to the quality of the engineering with our plastic rebar support product line. This will have a major impact in our industry in terms of the acceptance of recycled plastic rebar supports as the industry standard."
The rising price of steel has wreaked havoc with budgets in the construction sector. "The price of steel has led to a lot of uncertainty among construction contractors and has made it difficult for them to provide reliable pricing," Mr. Turek said. "We are fortunate because our raw materials are so abundant, therefore we can reliably provide our products at a much more cost-effective price point than steel. Again, we see the soaring price of steel as one of the major industry trends that is driving business to Plasticon International as we move forward."
Based on world demand and the dramatic increase in construction in emerging markets, the price of steel is unlikely to retrace, but rather all indications are that it will continue to rise. This trend is very likely to continue and has very positive repercussions for Plasticon International's core business -- their recycled plastic resin rebar support product line.
For more information, please visit Plasticon International online at www.plasticonintl.com.
About Plasticon International, Inc.
Plasticon International, Inc. (www.plasticonintl.com) designs, produces, and distributes high-quality concrete accessories, transportation signage, plastic lumber, and office supplies which are all produced from recycled and recyclable plastics. Plasticon is a leader, an innovator of cutting edge design, engineering, and production of industrial and commercial products. Plasticon is a green Company, environmentally friendly, using recycled plastics to produce its line of products.
SOURCE: Plasticon International, Inc.
Plasticon International, Inc.
Jim Turek, president and CEO
3166 Custer Drive, Suite 101
Lexington, Kentucky 40517
web site: www.plasticonintl.com
Contact Investor Relations:
Bill Howe
Ph: 800-889-0915
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