Understanding the differences between Domestic Wire Sourcing Requirements
As an American manufacturer of wire , the sourcing of products and raw material is an important topic for Central Wire Industries. Not only does it affect the performance qualification of our stainless steel wire to the various industries we support, it dictates which sourcing requirements our products meet in qualifying for inclusion in federal, state, and local contracts.
As we are learning with the recent focus on changes to the Buy American Act, various pieces of legislation and associated requirements related to steel sourcing place a preference on steel products that are manufactured here in the United States. This keeps important manufacturing jobs in the United States, while also supporting research and development to keep our industries on the cutting edge of technology. In short, it ensures that the steel industry, and American wire manufacturing particularly, are ready to support the needs of the United States when foreign sources may not want or may not be able to do so.
To help understand what the various pieces of legislation currently mean to the wire rope industry, here is a brief explanation of several of those requirements:
100% Domestic/Buy America Act
The Surface Transportation Assistance Act of 1982 was established to help ease concerns over the surface transportation infrastructure (i.e., highways and bridges). Part of the Act includes the Buy America Act, which requires any federally funded transportation job to use only Made in the USA steel products. The Buy America Act requires that all manufacturing processes occur within the United States. This means everything from the melting of the steel/stainless steel to the final drawing must be performed within the US. For example, the wire rope industry most often requests for 100% domestic products when the Department of Transportation (DOT) or federal funds are involved. Steel projects requiring welding wire and consumables also has a strong preference for 100% domestic material.
This act ensures that essentials business and technologies remain viable in the United States, that employees keep their jobs and skills, and that these companies and industries are available when the nation needs them.
Buy American Act
The Buy American Act currently requires that the cost of supplies or raw materials which are manufactured inside the U.S. must exceed 55% of the total cost of the end product for most products, and 95% when the end product is iron or steel (in this case, the wire itself). This means that if the steel was melted overseas, the manufacturer’s cost contribution, including any additional material and the employees labor, must exceed 50% of the overall cost in order to conform to this requirement.
Note: Recent changes from the federal government increased the above threshold for the Buy American Act from 50% to 95% for Steel Products, meaning the requirements for this act will mirror more closely those of the Buy America/100% Domestic requirements mentioned above.
Domestic Stainless Steel Wire
Domestic Stainless Steel wire is wire which is drawn in the USA, in American factories by American Workers. This means that some of the material making up the rope may be globally sourced. Raw material, including rod or billet, may come from a foreign source and then be processed in an American faculty. This ensures that manufacturing equipment is running and people are employed, but much of the value of the up-stream material is given to overseas companies.
In the end, to meet the Buy America, American, or general Domestic manufacture requirements means that you meet the specifications stated above. But to Buy American means more than just that: It means you are supporting a critical industry so that workers keep their paychecks and the skills they need, especially for those times when we as a country need them. So even when the law doesn't require it, it's always a good policy to support American Manufacturing and to Buy American.
To learn more about the Made in the USA Wire products that Central Wire can provide, visit our website www.centralwire.com today. We offer 8 locations in the USA that manufacture wire products, and 3 more that manufacture other related products, such as wire rope and aircraft cable, wire rope fittings, and wire rope assemblies. With over 60 years of experience Drawing on Innovation, we would love the opportunity to quote your next Buy American project, or any project for that matter!