August ISM-PMI – Bullish on Manufacturing

September 2, 2014

“The August PMI® is led by the highest recorded New Orders Index since April 2004 when it registered 67.1 percent. At the same time, comments from the panel reflect a positive outlook mixed with caution over global geopolitical unrest.”

Manufacturing is looking good according to the writing on the wall- and August ISM PMI.

Manufacturing is looking good according to the writing on the wall- and August ISM PMI.

The ISM PMI index for  Manufacturing in the United States has been a good leading indicator for US GDP. We like to calibrate our Precision Machining Industry’s performance against it as well.

Our July PMPA Business Trends Report showed that our industry outperformed several FED manufacturing indicators. Our July Sales  usually low because of summer shutdowns, vacations and retooling in Customer plants, were at the average for the Calendar year. today, ISM PMI shows that that positivity extending to August.

Today’s report from Institute for Supply Management showed the indicator rose 1.9 percent to 59 in August from 57.1 in July. This is a very optimistic reading, showing that the manufacturing economy expanded for the 15th consecutive month.


What does a bull sound like for prospects in manufacturing?

“This month’s PMI® reflects the highest reading since March 2011 when the index registered 59.1 percent. The New Orders Index registered 66.7 percent, an increase of 3.3 percentage points from the 63.4 percent reading in July, indicating growth in new orders for the 15th consecutive month. The Production Index registered 64.5 percent, 3.3 percentage points above the July reading of 61.2 percent. The Employment Index grew for the 14th consecutive month, registering 58.1 percent, a slight decrease of 0.1 percentage point below the July reading of 58.2 percent. Inventories of raw materials registered 52 percent, an increase of 3.5 percentage points from the July reading of 48.5 percent, indicating growth in inventories following one month of contraction. The August PMI® is led by the highest recorded New Orders Index since April 2004 when it registered 67.1 percent. At the same time, comments from the panel reflect a positive outlook mixed with caution over global geopolitical unrest.” -Bradley J Holcomb, Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.

PMPA  Business Trends data for July has also painted a picture of stronger than seasonally expected performance. We can hardly wit to see how the PMI August Data compares to our industry performance.

Graph courtesy Calculated Risk Blog

Street art courtesy REDBOY at Street and Stage Blog

Pipe Steel- Internal Defect

August 28, 2014

The majority of defects encountered in steel bars in our shops are found on the surface. Internal defects can also be encountered, and we posted about central burst (chevron) defects here. This post describes Pipe Steel.

Definition: A central cavity formed by contraction of the metal during solidification is called pipe.

When this cavity is found in wrought or cast products, this is also called pipe.

Pipe steel centerline defect in wrought steel bar. We had this specimen hard chrome plated and made it into a bookend.

Pipe steel centerline defect in wrought steel bar. We had this specimen hard chrome plated and made it into a bookend.

In the days of ingot casting, the location of the shrinkage cavity was controlled by ingot mold design and the addition of hot tops to assure that after cropping the material containing the void off, there would remain sufficient sound material to roll into product.

Today with modern computer controlled billet and bloom casting processes, pipe steel and center porosity is very seldom encountered.

Recently a question was asked about centerline defects on cast billets in one of my LinkedIn Groups.

“hello can any one tell us why some times whe have holes along the center of the billets just casted thanks”

Despite a lack of specifics about grade, deoxidation, and many other factors,  we can make some comments based on the fact that this is continuously cast billets according to question.

Here are my comments addressing the continuous  billet casting process and how it can be implicated in the creation of centerline voids (pipe steel defects).

The three key parameters in the casting process that are most likely to result in centerline pipe are

  1. Casting speed
  2. Superheat
  3. Electromagnetic Stirring. EMS amperage and frequency (Together they drive intensity.)

1. Casting Speed- Incorrect casting speed can result in pipe/ centerline looseness/ porosity. This can be aggravated by issues with mold level control.  Slow down your casting speed to get sufficient solidification.

2. Superheat is critical to maintaining the proper fluidity and solidification dynamics in the mold. Liquid metal shrinks in three steps; 1) volume decreases the liquid cools goes from the pouring temperature to the freezing temperature;  2) volume decreases as the metal solidifies. This is reinforced by the driving out of dissolved gases as the metal freezes; 3) the metal shrinks as it cools from solidification temperature to ambient  temperature.

3. Electromagnetic Stirring (EMS)- If you macroetch transverse sections of the billets and still see columnar rather than equiaxed grain structure in the cast billet, it is a sign that the EMS is ineffective.

There are a host of other operating parameters as well as chemistry and processes that can contribute to porous centers or central cavity pipe steel defects. Here is a list of questions to help address these:

Do you have adequate cooling water through the molds? Are you running EMS? What is the metallurgical distance on this caster? What is the mold level control? Evidence of turbulence into the mold? Meters per minute for casting speed?  Shrouding status on nozzles? What was superheat? What was water flow?

Do you have chemistry in control, steel deoxidized, so that the large void is a result of solidification shrinkage, not divorce of gas from the liquid steel? What is grade? What was deoxidizer?

Continuous casting of steel is a complex process with a large number of operating parameters and processes that need to be in close control. Understanding how these parameters can impact the final product is critical to eliminating defects that result from lack of control.

Precision Machining Industry Out-Performed Industrial Production and Factory Output July 2014

August 27, 2014

The Precision Machining Industry continues to show solid sales in 2014. The PMPA Business Trends Index for July 2014 rose 3 points  over last month (~2.5%) from 120 to 123. Up 8 points over July 2013. 

According to the Fed, Industrial Production (IP) for July was up 0.4% and Factory Output was up 1%.

Our index out-performed these Fed Benchmarks.

up 8 points over last year, 3 points above last month.

Up 8 points over last year, 3 points above last month.


Automotive is a market heavily served by our industry, and the Fed reported Auto Production to be up 10.1% in July.

We believe our  industry’s strong sales performance was a result of the surge in auto production in July.

Forward looking sentiment of respondents for next three months rose for Profitability; leveled off for Sales; while Lead Time and Employment declined.

The July Industry sales was right at the average of industry sales for the year to date.

July garnered  a strong report.

See the July 2014 PMPA Business Trends Report here. 

Don’t Burn The Tool- Detterbeck Enterprises Cartoon

August 19, 2014

If a tool gets too hot to hold while grinding, you have already ruined it. You knew that, right?

A bit of circa 1965 Knowledge retention for  the archives of Lester Detterbeck Enterprises Ltd.

A bit of circa 1965 “Knowledge Retention” from the archives of Lester Detterbeck Enterprises Ltd.

By the time the heat gets to your hands and is too hot to hold, you have already lost the temper on the edge being ground. If you then put it in water to cool it down, depending on the material grade,  the water quench is likely to help form untempered martensite, a very brittle microstructure.

The tool will lose properties, and fail in very short order. Often with catastrophic consequences.

The point of grinding is to take very small amounts of removal by abrasion, not to create lots of heat by hogging the material off.

Heat treated tools are actually  very sophisticated system involving the interaction of  material chemistry, microstructure, mechanical properties (including hardness) and design.

Out of control grinding practices can destroy this system with a single temperature excursion above the tool’s last tempering temperature and formation of untempered martensite by water quenching.

Thanks to John Detterbeck  at Lester Detterbeck Enterprises Ltd for sharing the above cartoon and confirming the failure mode.

Grinding Advice You Probably Didn’t Know

August 14, 2014

 Our post on No Gloves When Working on Grinders has prompted a number of responses.

Here are some additional reasons why you should not even need gloves when working on grinders and grinding machines.

Issue: “There are sharp edges or burrs  that will cut me if I hold the part. The grinding will be to remove the burrs.”

Response: Use a file to knock down the burrs so that you can safely hold the part for grinding. Or use leather finger cots to grip the part for grinding.

We permitted these for use on belt grinders for holding small parts.

We permitted these for use on belt grinders for holding small parts.

Issue: “The part gets too hot to hold.”

Response: Then you are grinding wrong. Here is a list of some of the things that can go wrong  by letting the heat of grinding get out of control:

  • Remove the temper from Steel. Especially on tools, loss of temper means loss of tool hardness and edge life. A drop from Rc63 to about Rc48 for a couple of tenths (0.0002-0.0005) can contribute to side wear and edge failure.
  • Crazing or checking on Carbide can be caused by burning during grinding.
  • Work Hardening. Overly shiny surfaces are usually the clue that work hardening has occurred.
  • Creation of untempered martensite.

Untempered martensite can be formed in high carbon and alloy steels by getting high surface temperature from grinding- red heat- then quenching in water.

  • Untempered martensite is very brittle and reduces toughness.
  • Keeping the work cool  continuously while grinding is an important aspect of preventing damage to work, the wheel, and injury from occurring to the worker. Hogging off material and infrequently quenching is a great way to destroy a tool by grinding
  • Water needs to be plentiful to absorb the heat from grinding,  and frequently used to reduce heat buildup in the work.
  • Take multiple small passes  and cool in between in a large bath of water while grinding to minimize heat build up.

Of course, wearing the required PPE, making sure the grinding wheel is properly dressed, all guards are in place and properly adjusted are also key to safe grinding in our shops.

Bottom line: If the work is too hot for your fingers, it may be approaching the danger zone regarding loss of mechanical properties and function in end use.

Photo credit


Gloves and Grinders – UNSAFE OSHA

August 13, 2014

If there is a worse combination than grinders and gloves, I don’t know what it is, except perhaps for gloves and a drill.

We posted a really cool video on our career blog about making a light saber sword here. But we were shocked to see the guys in the video wearing heavy leather gloves while working with grinders.

Never wear gloves with grinders.  or operate grinders with guards removed.

Never wear gloves with grinders. Or operate grinders with guards removed.

By “grinders,” we mean abrasive belt grinders, bench grinders, pedestal grinders, surface grinders, and also abrasive cutoff machines.

No Gloves!

No Gloves!

Sanders, polishers, and buffers that involve rotating wheels or transversing motion are also included in this classification for the purposes of hazard analysis.

Here are 6 reasons to not wear/not permit the wearing of gloves while working with Grinders or Grinding Machines

  • Amputations
  • General duty of employer to provide a workplace free of recognized hazards
  • Gloves can catch on rotating equipment and pull operators hands into the equipment
  • Rotation of grinding wheels is at high RPM’s
  • Operator cannot get hand out of glove when it catches
  • Equipment horsepower and machine material properties exceed those of the operators flesh

We did a quick calculation and a 12″ grinding wheel and 3600 rpm and arrived at a speed on the periphery of 120 miles per hour.

No time to react.

More info on preventing amputations from OSHA


Factoryless Goods Producer Classification Proposal Withdrawn by OMB

August 8, 2014

In a resounding victory for actual manufacturers- the people that make things- the OMB reported today that the proposal to create a “Factoryless Goods Producer’ classification for the NAICS 2017 has been withdrawn.

PMPA has been on the forefront of challenging the classification which would have created a class of phantom manufactures that did not actually manufacture goods, but rather purchased finished goods for resale, and possibly from foreign sources. August 1 2012 link, March 17, 2014 link, July 16, 2014 link

Withdrawing proposal for a Factoryless Goods producer Classification in NAICS 2017

Withdrawing proposal for a Factoryless Goods Producer Classification in NAICS 2017

On May 22, 2014, the Administration announced the U.S. Census Bureau was considering a proposal to count a business as a manufacturer even if they outsource all of the transformation steps traditionally considered production activities, or manufacturing. The proposal would have counted some activities outsourced overseas as U.S. manufacturing and included financiers and others as manufacturers even though they never visit a shop floor.

Among PMPA’s objections to the scheme were the following:

  • NAICS is based on the primary activity of an establishment. In the absence of actual production processes, the primary activity of the so-called “Factoryless Goods Producers” is Wholesale activity. “Factoryless Goods Producers” produce no goods, and employ no manufacturing processes. They do not “produce goods.” They employ actual manufacturers who utilize recognized transformative processes to manufacture goods. This makes the proposed FGPs best classified by their “process” as Wholesale trade. 
  • NAICS is for classifying domestic activities only. In many cases, the outsourcing of the “Factoryless Goods Producer’s” actual manufacturing occurs overseas. The NAICS System is for classifying North American operations only. Classifying as a “manufacturer of record” any entity that outsources actual manufacturing operations to off shore / overseas companies allows the distortion of statistics based on said classification. Federal regulations are replete with rules regarding the origin and labeling of production. Yet the proposed change to recognize “FGP’s” as “Manufacturers” would foster the type of inaccuracy and mischaracterization that these labeling rules are expressly designed to prevent. An NAICS classification should not mislead the public that manufacturing occurred in a U.S. establishment when in fact the manufacturing took place in a faraway land that, perhaps, does not provide the same types of wages, working conditions and environmental protections as U.S. manufacturers.

PMPA commented that by definition, a business must manufacture or alter the physical content of a product to fall under NAICS 31-33.

Further, these production activities must occur within North America, or they undermine the very purpose of a North American Industry Classification System.

If manufacturing processes are not actually required for a “manufacturing” classification, the statistics produced by such a distorted definition are virtually useless.

“This is an important victory for U.S. businesses and we applaud the Administration for recognizing the flawed thinking behind this proposal,” said Mike Kobylka, Executive Director of PMPA. “This proposal would have created a class of phantom manufacturers. The NAICS classification system has never and should never take into account foreign sourced production processes.”

August 8 Federal Register Notice withdrawing FGP Proposal for NAICS 2017.


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