In tonight’s Steel Market Update (SMU) newsletter we will cover items of interest to the flat rolled steel industry in North America and across the world. Steel Market Update just completed a steel market survey as of this afternoon. For the past four days we have been collecting information on a wide variety of topics from those actively involved in the flat rolled steel industry in the U.S. and Canada.

Some of the topics which will be covered this evening include Read more ...

As soon as Steel Market Update saw the Baltimore Brew article regarding RG Steel we requested comments through both the RG Steel spokesperson (who is on vacation) as well as through Mr. Jerry Nelson who is the General Manager of Commercial for RG Steel. Mr. Nelson was kind enough to respond to our request and allow us to publish his comments which we have done in their entirety:

ThyssenKrupp corporate headquarters in Germany has put out a press release regarding their plan to look at "strategic options" regarding the potential sale or new partnership regarding their two Steel Americas plants. ThyssenKrupp Steel USA is a conversion mill capable of rolling 4.0+ million tons of carbon flat rolled (hot rolled, cold rolled, galvanized, Galvalume, Aluminized. In Brazil their CSA plant produces slabs to service the Mobile, Alabama TKS USA mill Read more ...

The Baltimore Brew has published an article this evening that RG Steel is suffering from a “liquidity crisis” based on reports coming from USW Local 9477 which is responsible for the union workers at the Sparrows Point mill. Reports coming from the union expect layoffs in the coming weeks Read more ...

ArcelorMittal is a sponsor for the London 2012 Olympic and Paralympic Games. The company has given the city of London a new landmark which will remain long after the games have come and gone. Read more ...

Canada’s employment levels increased by 58,000 jobs in April, which is 1.2% more than in last April. April was the second month of increases, even as the unemployment rate increased by 0.1% to 7.3%. Read more ...

Based on Steel Market Update (SMU) sources, RG Steel Sparrows Point blast furnace was taken down on Wednesday for maintenance. The furnace was originally scheduled to come back up by this morning but was extended for an extra day or two. The rest of the mill is running as normal and SMU is not aware of any interruptions in source materials or any other issues with the mill Read more ...

Written by: Andre Marshall, CEO Crunch Risk, LLC

Hot Rolled NYMEX:

It was a quiet week with almost nothing trading until yesterday when 829 lots (16,580 ST) traded on the back of the CRU price drop of $13/ST that morning. The CRU Wednesday price, which was $669/ST, had dropped considerably after having gone up $4/ST Read more ...

ArcelorMittal reports first quarter 2012 results with net income of $11 million, up from a net loss of $1.0 billion for 4Q 2011. However, annually the company was below the $1.1 billion net income reported in 1Q11. Read more ...

In last evening’s Steel Market Update newsletter we published an article about the precipitous decline in flat rolled steel prices since the end of January. We are hearing in the marketplace from both buyers and sellers of hot rolled, cold rolled and coated products that something has to give – either prices reverse course or the domestic mills must take capacity out of the market Read more ...

In March, contractors in Canada reported building permits worth $6.8 billion, up 4.7% from the previous month. Statistics Canada attributes the gain to higher construction intentions for both institutional and commercial Read more ...

Service center Olympic Steel reported earnings of $6.2 million for the 1st Quarter 2012 on $382.1 million in sales. The company advised analysts during their earnings conference call the $382.1 million sales mark is a record for the company. Read more ...

The construction industry lost 2,000 jobs in April, slightly lower than the 3,000 lost jobs in March. However, April showed a 1.1% or 63,000 job gain over Read more ...

The Steel Market Update (SMU) Steel Buyers Sentiment Index remained in optimistic territory this week as our index was measured at +36. This is two points lower than the +38 measured during the middle of April and is thirteen points higher than one year ago when our Sentiment Index was reported at +23. Our latest reading is two points higher than the lowest reading of the year (+34) achieved at the beginning of April.

Read more ...

Dear Editor,

As reported by Steel Market Update (SMU 4/29), “Thank God for Foreign Fighters” was a statement made by a well-known steel analyst during Reliance Steel & Aluminum's recent quarterly earnings conference call. I have some thoughts about that comment (and about some of the other comments that were made). To add insult to injury, Reliance's no. 2 man Gregg Mollins responded with an "Amen" to the analysts comment. Read more ...

General Motors Co. announced first quarter 2012 earnings with net income of 1.0 billion, down from $3.2 billion in 1Q11. Net revenue was $37.8 billion, up $1.6 billion compared to 1Q11. Read more ...

Canadian manufacturing business conditions in April improved to the greatest extent in 2012 so far, according to the RBC Canadian Manufacturing Purchasing Managers Index. Read more ...

Construction employment increased in 155 out of 337 metro areas in the past year, from March 2011 and March 2012. However, employment also decreased in Read more ...

U.S. industry light vehicle auto sales figures for April were released today and are projected at an estimated 14.6 million units Seasonally Adjusted Annual Rate (SAAR). Actual sales were higher than the 14.4 SAAR forecast Read more ...

According to the Association of General Contractors, the latest update on construction spending is below:

Construction spending inched up in March 2012 to an annualized rate of $808 billion, up 0.1 percent compared to the previous month and is now 6 percent above year ago Read more ...

Since Reliance was speaking about plate during their conference call with analysts this past week SMU decided to take a quick look at the U.S. Department of Commerce import data for the months of March and April 2012 Read more ...

Written by: John Packard

Earlier today Steel Market Update adjusted our SMU Price Momentum Indicator from “Neutral” to “Lower.” Based on information regarding lead times, pricing and negotiations between steel mills and their customers is leading us to believe the Read more ...

Worthington Industries posted this press release on its new management appointments:

Columbus, OH, April 26, 2012 – Worthington Industries, Inc. (WOR: NYSE) announced today that Read more ...

New orders for manufactured durable goods in March dropped 4.2% from February to $202.6 billion. New orders have been up and Read more ...

According to The Bureau of Labor Statistics, the Producer Price Index (PPI) for materials and components used in construction were up 0.2% in March from February and up 3.1% from March 2011. Raw materials prices used in construction or to produce products used in construction gained 0.4% in March after a previous 0.7% monthly increase and increased 3% y-o-y.

The index for nonresidential construction input costs rose 1.6% in March following a 0.8% increase in February driven by high energy cost.

Reed Construction Data forecast that construction activity will rise, resulting in “modest upward pressure on construction materials prices. As the economy advances at a moderate pace, prices will move roughly in line with general inflation. Faster than projected sustained economic growth (3% or higher at an annual rate) will accelerate commercial construction activity and push materials price inflation higher than general inflation. This seems unlikely to happen before the second half of 2012.” RCD stresses the risk of rising energy and oil prices as the biggest risk to materials price inflation and the economy.

Sources: The Bureau of Labor Statistics & Reed Construction Data

Steel Market Update (SMU) Steel Buyers Sentiment Index improved by 4 points was measured at +38 during our most recent steel market survey which concluded on Wednesday of this week. This means our Sentiment Index continues within the optimistic Read more ...

Written by: Joseph Reinmann, CEO Kataman Metals

If the futures market was a voting machine, then the results are official – the mill price increases have failed.

Hot Rolled Coil (HRC) futures prices on the CME declined this Read more ...

Existing-home sales for March were down 2.6% from February to an annual pace of 4.48 million. Sales are 5.2% higher than year-ago levels, as Lawrence Yun, Read more ...

CALVERT, ALABAMA [April 17, 2012] ThyssenKrupp Steel USA announced today that its team has achieved a key operational milestone by receiving the International Organization for Standardization’s Read more ...

Reliance Steel & Aluminum just posted the following release on its first quarter earnings:

LOS ANGELES, Apr 16, 2012 (BUSINESS WIRE) -- Reliance Steel & Aluminum Co. RS +4.53% announced today that it is updating its Read more ...

According to a recently released AISI report, domestic mill shipments of carbon steel products declined by Read more ...

Building permits provide an early indication of building activity. Total building permits for Canada rose 7.5% to $6.5 billion in February, Read more ...

The SMU/Steel Reality Fair Value HRC model recognized spot HRC and scrap prices falling again last week moving fair value back into Read more ...

Construction employment increased in 171 out of 337 metro from February 2011 and February 2012 while declining in 119. Read more ...

Are Questions about Demand, Pricing & Supply Negatively Impacting Sentiment? Read more ...

Written by: Joseph Reinmann, Kataman Metals

Hot Rolled Coil (HRC) futures prices on the CME were mixed this week as March rolled off. Q2 2012 prices decreased $3 per ton to $690 while Q3 increased by $1 per ton to $676 and Q4 was essentially unchanged at $675 Read more ...

Two more domestic steel mills announced price increases over the past 24 hours. RG Steel and Severstal NA have both made announcements to their customers.

In a letter to their customers dated April 4th RG Steel advised they were taking prices up $25 per ton on all hot rolled, cold rolled, galvanized and Galvalume products sold into the spot market Read more ...

CHICAGO, Apr 3, 2012 (GlobeNewswire via COMTEX) -- JMC Steel Group Inc. ("JMC") announced today that it has completed its acquisition of Lakeside Steel Inc. /quotes/zigman/529739 CA:LS 0.00% ("Lakeside"). Pursuant to the arrangement under the Business Corporations Act (Ontario) (the "Arrangement"), JMC, through a wholly owned subsidiary, acquired all of the issued and outstanding common shares of Lakeside at a price of CAD $0.2983 per share in cash Read more ...

Since late last week two domestic steel mills – ArcelorMittal raised prices on their “spot” business by approximately $20 per ton. The new “minimum” base price for hot rolled out of ArcelorMittal USA is reported to be $720 per ton according to emails seen by Steel Market Update Read more ...

April 1, 2012 - The Honourable Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway, today announced the implementation of a new import system for steel and steel products. This measure, taking effect today, will reduce congestion at the Canada-U.S. border and remove the financial and administrative burden facing Canadian businesses Read more ...

Steel Market Update (SMU) has two steel-related workshops which will be held later this month. For those concerned about fluctuating steel prices and its impact on your or your customer’s business we have our Hedging Price Risk workshop which is held in Chicago on April 11th. Our second workshop which will be held this month is our Steel 101: Introduction to Steelmaking & Market Fundamentals workshop. This workshop will be held in Dearborn, Michigan on April 24-25, 2012 and will include a tour of the Severstal Dearborn steel mill Read more ...

March was perhaps the month where there were more questions than answers. The first week of the month began with hot rolled prices averaging $695 they then dropped to $670 per ton and ended the month almost back to the level where they began. Other flat rolled products indexed by Steel Market Update (SMU) had similar paths during the month and ended either at, or within $10 per ton ($.50/cwt) of where they began at the beginning of the month Read more ...

Steel Market Update (SMU) has moved our SMU Price Momentum Indicator to “Neutral” from “Higher.” We have made this move based on a review of the market over the past two weeks and have determined based on our perspective steel prices will be range Read more ...

Last week a Western New York dealer sold shred into the Ohio and Western Pennsylvania markets down $10 per gross ton compared to prices at the beginning of the month. Many involved in the scrap business do not see these sales as a leading indicator of where prices will be set for April mill shipments. Read more ...

Lakeside Steel’s shareholders have announced their approval of JMC Steel Group’s subsidiary acquiring the company. Read more ...

Written by: Tony Bonavita

Modern purchasing professionals are tasked to not only buy at the cheapest price, but to identify and mitigate risks in the supply chain. A low price is fantastic, but if the material arrives late, has quality issues, or was poorly run, than that low price is no longer… well, low. Additional “cost” is added to the bottom line (not to mention all your extra time). Read more ...

Steel Market Update (SMU) is dedicated to educating those involved in the steel industry be they buyers or sellers of flat rolled or long products. We conduct various workshops and conferences with the expressed purpose of educating management and those determined to be "up and coming" or "A" players within an organization Read more ...

Written by: John Packard

I was speaking with the Director of Strategic Sourcing for a multi-billion dollar company this morning. The individual (in this case it is a woman) had just been promoted to the position and as she reviewed various companies around the world and their steel coil needs she found gaps in her product knowledge. Read more ...

Steel Market Update (SMU) Steel Buyers Sentiment Index remained firmly in optimistic territory registering +39 according to our survey conducted this week. Our index is down 6 points from the beginning of the month of March Read more ...