U.S. steelmakers are still searching for a comfy bed in which markets will stabilize enough to make everyone in the supply chain a winner.

"2004 was too hot, 2005 was too cold; and when we look ... 2006 will be just right," said Lou Schorsch, chief executive officer of Mittal Steel USA.

The CEO of the North American division of the world's largest steelmaker named his presentation at Monday's SBB Steel Markets North America conference "Goldilocks and the three years."

After noting maybe the title was maybe a little too cute, Schorsch told a tale of a continuing roller-coaster ride in the steel industry that some thought was over at the end of 2003.

More than 150 steel industry managers, executives and others followed Schorsch's talk with rapt attention at the Chicago Hilton's Continental Room.

After a boom in prices in 2004 had steelmakers recording banner profits, those prices sagged in 2005. Schorsch lay much of the blame on the industry itself.

There was a 25 percent drop in shipments, but that was due to large inventories steel companies built up, not a drop in demand.

That drop in shipments was equal to what steelmakers would experience in a moderate recession, Schorsch said.

"We want to maintain the stability we've earned," he added.

This year should see steady demand, and the industry itself has made tremendous strides in helping itself, said Michelle Applebaum, managing director of Michelle Applebaum research and Steel Market Intelligence.

"All the pieces are in place," she told her audience, as she gave her part of a panel presentation along with Schorsch and Chuck Bradford, president of Bradford Research.

Prices should rise in 2006, and consolidation in the industry will allow it to better adjust to markets, Applebaum said.

In addition, unprecedented cooperation from unions has changed the landscape in the industry.

"The dialogue they have with the steelworkers and the support the steelworkers have given the industry are just incredible," she said.

Schorsch pointed out the new, more flexible compensation of steel workers allowed the industry to better weather the sag in prices and shipments in 2005.

In addition, consolidated companies were able to shut down blast furnaces to lessen output, something that would have been very difficult when each company owned only two or three.