Crucible Industries Update

[Delgadonine]

Something I alluded to in another thread recently, there are many many factors that impact whether a business is successful or not. You have supply and demand forces, macro economics, industry specific trends and changes, international influences, inflationary pressures, etc.
To run a successful business and keep it going for the long term requires staying in a good place in the supply and demand curve (which by the way are almost completely out of a companies control) and being able to be efficient enough to hold off competition while still maintaining a sustainable level of profitability. As we find more and more companies making steels, materials, knives, etc. eventually supply and demand kick in and only the most efficient companies who can manage to stay competitive and manage their businesses well, or have some competitive advantage over others will make it long term. Again, not to say that Crucible was mismanaged or inefficient, but keeping a business viable also requires a great deal of luck due to the many factors that are beyond an individual company's control.

Counterfeiters are the biggest enemy and threat to the industry. Both corporate and custom makers have to contend with this variable.

People wanting things for cheap outnumber those of us who will pay for quality.

 

[beeinak]

OK, I am babe in the woods on this topic. Is the trouble ar Crucible a technicsal issue that may be resolved . . . like a refinery shut down for maintained. or repair? Or is the trouble in the area of business?

What specialty steels does CPM produce that are commonly used in the knife business? Magnicut is one that I know. I have a vague understanding that S35V, S45VN and so on would also be affected.

Thanks for the update and efforts to keep things moving.

Might check post #10 with link regarding products

 

[Blues]

A couple of off-topic / far afield posts have been removed for the sake of both clarity and keeping this thread (somewhat) on track. It would be helpful if folks would actually endeavor to read the thread, especially the comments by the folks in the know, before opining.

Thank you.

 

[Seedy Lot]

I wonder what's really going on behind the scenes... I mean, how badly do you mismanage a company to bankrupt it after 100 years in business?? Its not like they make typewriters and got overtaken by computers. They make an in-demand product used across a number of industries, including automotive, cutlery, aerospace, and machine tools. Did they hire finance and/or tech bros to run the place?

Crucible did file bankruptcy in May of 2009 blaming it on a drop in sales from the automotive industry.

 

[Larrin]

Is there far more to this than taxes, if so please elaborate if you know, if you don't know then your assuming and in your post stating things matter of fact like you do, well in your assumption your trying to question the motives of other members post. Not cool.

Secondarily, you also post on the previous page that Bob answered everyone's questions in his first post. Not entirely. A user here posted the list of steels available through Crucible. Should you read that list, you will note that many of the steels have a registered trade market symbol by them. Should Crucible be sold, all of the trade marked steels might or might not go with the sale, the could be sold off individually or in bundles. Should the new owner choose to change, alter or simply do away with or sell those trade marked steels (formulas), the new owner of the formula could do the same thing. Lastly, should a buyer not be found and God (sorry if that offends you) forbid they close, whatever trade marked formulas they did not sell could potentially (not saying they would but could) go the way of the dinosaur. Your responses here are very matter of fact, yet there is not data to back them up, you just make the statement as if its true and you know things they everyone here doesn't and then tell everyone to stop making more of it than it is, and other directives. Again, not cool. If you know the whole story or a whole lot more of the story than the rest of here, please post and source. If not stop lecturing everyone based upon your assumptions.

Matt was responding to the assumption that taxes made up the bulk of their problems. That was the assumption that needs further evidence.

Trademarks are not patents. A trademark is a name and does not protect a composition. Most of Crucible’s patents have expired apart from S110V which expires in April I believe.

 

[DeadboxHero]

History about the 2009 bankruptcy causes and reorganization.

Steelworkers reach agreement with new Crucible owner

J.P. Industries Inc. hopes to reopen the Geddes steel plant next month.

www.syracuse.com

The complete timeline of Crucible leading up to the 2009 bankruptcy.

A timeline of Crucible Materials Corp.

Geddes, NY -- Crucible Materials Corp. in Geddes announced today that it has filed for Chapter 11 bankruptcy protection. Here's a brief history of the company, compiled from newspaper archives:...

www.syracuse.com

I don't think knife steel pays the bills like automotive steel does.

Hopefully Crucible can reorganize again.

 

[LostCause]

I honestly doubt this is the end of Crucible.

They filed for Chapter 11 just like in 2009. They will probably manage to pull it off just like in 2009.

They are a big name and big part of the business. So I'd not be surprised if someone bought the company.


But, what does concern me is that this is the second time, and the problems under the surface that we cannot see.

I love their steels, the CPM-3V is my favorite, and I carry S35VN every day... I'd be really sad to see them go.

 

[Delta-v]

That's sad news. It's hard to imagine the knife world without Crucible.

 

[ferider]

The steel industry in general, is a victim of cheap foreign competition.

View attachment 2732808

Not disagreeing, just some updated numbers:

 

[Larrin]

It is important to realize that these charts of steel tonnage do not necessarily reflect competition with Crucible. The specialty tool steel market is a small percentage tonnage wise of overall steel production. The big tons of steel are in totally different product categories. I’m not saying there isn’t competition globally, but these charts of the overall steel market do not necessarily paint a picture of what Crucible specifically is facing.

 

[Tsujigiri]

I kind of doubt that knife steel makes a huge percentage of Crucible's sales. I see a lot of 300 and 400 series stainless steels in their catalog, which are huge in industry. And tool steels get used not just for "hand tools," but also for molds and dies. The amount of knives being made are miniscule by comparison, and knives use very little material anyway.

They might be cutting their prices on the more common grades of steel just to remain competitive with China, and becoming unprofitable as a result. An unfortunate result of China's domestic manufacturing subsidies is that all too often, CNC job shops in the US are being shown competing quotes from overseas that are lower for complete parts than they could even buy the raw material for here.specialrisk.claims@mutualofomaha.com

 

[Matthew Gregory]

MikeC I saw your post quoted in Larrin’s reply. As it’s not totally obvious that I’d be privy to any information, I’ll offer a bit of explanation. I’ve been friends with Bob at Niagara for closing in on two decades, I live close by to their rolling mill, and interact with those guys quite a bit. I’m also friends with Larrin. Like Shawn DeadboxHero , we’re both knifemakers, and we’re passionate about steel. Because of our circle of friends and our involvement with this stuff, we are allowed a bit of a glimpse behind the curtain, and that includes a little bit of the goings-on at Crucible Industries. That doesn’t mean we have ALL the information, but we probably have more than the average bladeforums lurker.

What I haven’t done, very intentionally, was give my thoughts on the whys and wherefores of these circumstances beyond stating that it’s not due to the policies of the state they’ve done business in for the last 100 years. When the dust settles, assuming any of us get the straight scoop of all the details, my thoughts are that this is a classic example of death from a thousand cuts.

 

[DMG]

The county just needs to defer the tax. Property taxes putting a long standing American steel mill out of business is awful.

If property taxes put them out of business they are so horribly mismanaged that they shouldn’t be saved.

The fact is that steel mills go through bankruptcies, restructuring and buyouts all the time. My friends father was an accountant for J&L for 30 years. The BS they went through with the union, the epa (especially the epa) and a hundred other factors make it really difficult to make steel in the US.

 

[AmericanEDC]

Damn…we’re all going to be memorizing some “formerly known as” new names of steel. All of us. And here I was thinking I mostly had a competency in discussing knife steels with fellow nerds. The list of Crucible steels used in our blades is fairly extensive.

I feel for all those families affected if Crucible doesn’t find a buyer or work its way out of this in Ch. 11.

I’ll be chatting with my buddy, an executive at Ford. He will have access to which suppliers, if any, this may affect given his position with North American Constraints management.

 

[Blade Lab]

Can someone explain how the supply chain generally works? I understand that many (most/all?) smaller makers purchase from Niagara, which buys and processes sheet steel from Crucible and other foundries? If so, is that also the case for larger companies, like Spyderco, Pro-Tech, Kershaw, etc.? What about Chinese companies who use U.S.-made steels?

Thanks!

 

[Blade Lab]

A supply chain works like a supply chain. Makers figure out what they want and give that information to their supplier. The supplier then puts it all together and sources the raw materials for a production run. The rest follows.

Right, but I guess what I'm asking, if anyone knows, is whether the large production companies ever purchase directly from a foundry like Crucible, or is there always a distributor like Niagra that processes the sheet steel into a more knife-friendly form.

 

[Blues]

Right, but I guess what I'm asking, if anyone knows, is whether the large production companies ever purchase directly from a foundry like Crucible, or is there always a distributor like Niagra that processes the sheet steel into a more knife-friendly form.

As things stand now, all of the CPM steel goes through Niagara Specialty Metals for processing before it is sent to makers / manufacturers / dealers. If and when Crucible should exit the picture, NSM is arranging to keep the flow of steels with the same chemistry, (regardless of the name which will be retained or changed due to existing rights), available to their customers.

nsm Matthew Gregory Larrin

Bob, Matt, Larrin, correct me if I didn't express this clearly enough or made an error.

 

[DeadboxHero]

Can someone explain how the supply chain generally works? I understand that many (most/all?) smaller makers purchase from Niagara, which buys and processes sheet steel from Crucible and other foundries? If so, is that also the case for larger companies, like Spyderco, Pro-Tech, Kershaw, etc.? What about Chinese companies who use U.S.-made steels?

Thanks!

Crucible is a steel mill.

Niagara is a rolling mill/distributor

Niagara buys the steel from Crucible.

Crucible sells large billets that have to be processed. (Unusable for knives)

Image: MagnaCut billets as received from Crucible Industries at Niagara Specialty Metals, ready to roll into sheets.

It is processed by Niagara into sheets for the knife industry to use.

Smaller makers usually buy 1-2" wide strips cut per foot from knife supply companies like NJSB, larger companies will buy steel in large sheets 2' x 3' directly from Niagara.

 

[Blade Lab]

Thanks, Shawn and Blues. Exactly what I was curious about.

 

[VTer]

We have orders for PM steels with the same Chemistry that Crucible offers. We don't anticipate any disruptions in product, but there may be new names depending on how things work out. Carpenter Technologies and Erasteel know these alloys and can make what we need. We are hopeful Crucible is sold to new ownership that is interested in making CPM alloys and we can continue to work with them.

Bob answered this in the first post, guys.

Perhaps to people more knowledgeable about industry jargon the phrase "the same Chemistry" conveys more than it does to me, but it wasn't obvious to me whether it encompassed all of the physical properties of the steel or merely its composition.