I am announcing a modest price increase on some flanges effective today, March 11, 2022. Our discount sheet will remain unchanged.

With the terrible war in Ukraine, our hearts go out to all the families suffering like no one can imagine. My father taught me, at an early age, that people around the world are the same. They want to provide food and shelter for their families and see their children achieve more than they did. With what is going on now, that dream for Ukrainian families seems much more difficult to attain.

The last time I wrote you, I could never have foreseen what is happening in the world or in the steel market that offers carbon steel fittings and flanges. There are companies in Europe and in the United States that are supplied steel made in Ukraine and Russia. With Ukraine shutting down due to the war, and Russian steel
makers being locked out of most of the world, these companies are now scrambling to source steel in all reaches of the globe. Nippon Steel, Japan’s steel giant, said it sources approximately 14% of its iron ore pellets for steel making from Russia and Ukraine. The geographical crisis has “spurred fears of supply disruption and surging costs of commodities from aluminum (hitting an all‐time high), to fuels, to iron ore.” Nippon Steel also sees a
potential demand for more seamless steel pipe because of gas disruptions in Europe and for demand and development of liquified natural gas projects. In addition, JFE Steel in Japan advised a 20% price increase for domestic product in March and one Chinese mill indicated they may renege on open contracts. Along with these
problems, the automobile industry has experienced reduced production because of the shortage of microchips. If automobile makers start receiving chips and get production more in line with demand, that will put an additional strain on steel supplies being directed to automobile production.

In the United States, steel for our products is still in very high demand. I talked to one of the largest steel providers for our flange products last week. He feels that pricing will continue to go up, at least through
summer, and will make no prediction beyond that. If that isn’t enough, there are some steel producers that are now refraining from quoting at this time and have made their recent offers all null and void.

With the pipe we buy in the United States since the first of the year, prices have jumped $600.00 a ton. Pipe companies are taking orders for shipments after 3rd Quarter but prices will be determined at the time of shipment.

I don’t think any of us have ever seen a situation like this that I feel could have major product disruptions and continued price increases if the war and the sanctions continue. At this time, Weldbend will not be taking on any new accounts or servicing dormant accounts. If you have any questions, please contact your
Weldbend sales representative or call us directly.

James J. Coulas III
Vice President, Sales

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