Memorandum on Government Steel Purchases

Memorandum for the Secretary of Defense, Administrator of General Services

Subject: Government Steel Purchases

In recent weeks several domestic steel producers have announced price increases for tin mill and structural steel products. If these price increases hold, they would bring the total price increases of steel mill products to 12 1/2 percent over September a year ago. In contrast, the average price increases for all industrial commodities have been about 7 percent over the past year.

I am asking the Council on Wage and Price Stability to begin immediately a study of prices, costs, and the overall economic position of steel manufacturing. I have also asked the Council to monitor developments in tin mill and structural steel markets closely over the next few months. In addition, I am asking for your assistance.

Your agency is responsible for the procurement of a major portion of those goods and services purchased by the Federal Government. I would like your contracting and purchasing officers to be particularly alert to the comparative prices of steel supplies. Those regulations designed to insure the procurement of lowest cost goods should be carefully followed. Where existing procurement regulations provide an opportunity for judgments, or the exercise of your discretion, you should be aware of the importance to my anti-inflation program of purchasing steel at the lowest possible cost.

JIMMY CARTER