Steel Market Update Begins 4th Year
Written by: John Packard, Publisher
Steel Market Update is just beginning its 4th year in business. This is how SMU got started and we offer now:
Back in 2004 I was an agent representing Winner Steel (now called Sharon Coatings & owned by NLMK) a galvanizing conversion mill. What is significant about 2004 was the flat rolled steel industry was in turmoil. Raw material and steel prices were skyrocketing on an almost daily basis to levels not seen before. The reasons for the radical adjustments to the market did not exist prior to the consolidation of the industry which had occurred during the previous four years. Steel companies who were once kings of the industry either ceased to exist or were part of new companies. At the same time the Dragon from the Far East – China – was building her appetite for raw materials and for steel.
The net result of all of the turmoil in the steel market was steel mills – including Winner Steel – were requiring their sales people to go back to customers and renegotiate pricing on existing orders. Lead times were extended and many items were actually not readily available for various reasons.
I had flat rolled customers spread around the United States – many of whom purchased items which became “short” as mills moved toward concentrating on producing tons – and eliminated difficult or less productive items from their order book.
In order to keep my customers abreast of the changes occurring in the marketplace I began to write Steel Market Update.
Volatility had come to the steel industry and we saw wild swings in raw materials, scrap, precious metals such as zinc and aluminum and in flat rolled steel prices. It was only a short period of time before I began to write about the market changes on almost a daily basis.
In mid-2007 Winner Steel was sold to the Duferco JV group (Duferco/Novolipetsk) and late in 2007 the agents representing Winner Steel were released. The Duferco JV decision affected each agent differently. For Paragon Metal Services, Inc. (my agency) it could not have come at a better time.
Through the first half 2008 I continued to write Steel Market Update for what were now my former customers and supporters around North America. The decision to incorporate and develop SMU as a service to be marketed to the North American steel industry was made early in the year and on August 1, 2008 Steel Market Update, Inc. became a legal entity.
My goal both then and now was to produce a newsletter and support information from an active steel perspective. I felt my 31 years of active steel sales, purchasing and management in the service center, trading company and steel mill segments of the industry provided SMU with something not available to any other periodical. I believed I could provide value by leveraging my contacts and experiences while remaining honest, yet sensitive to the needs of the North American flat rolled industry.
I added a little extra twist to our product – a guarantee – if Steel Market Update does not provide value to you and your company we will refund your most recent investment in a membership to SMU.
We were surprised early on as our first customer - Martin Bruner of Weldseam - was not one of my former Winner Steel customers. In fact, I didn’t even know anything about the company. Our second customer was Chuck Bradford (steel analyst) with whom I had never spoken prior to his signing up for SMU. Steel Market Update membership today is comprised of many companies – the vast majority of whom have zero connection to me in my former steel sales life. I believe this is a tribute to the process of providing accurate information on a timely basis.
Over the last three years, SMU has built its second website (the one we have now), developed a new logo, new products (such as our SMU Steel Buyers Sentiment Index) and changed the look and feel of the newsletter itself. SMU has grown from a one-man operation to four full time employees, we added four very experienced instructors to help design and run our various workshops and we added six contributing writers – all actively involved in the steel industry.
Our readership has changed over the years. By the time the financial market collapsed at the end of September SMU had enough members to get us over the hump and allow us to continue to upgrade and grow the product. Since August 2008 Steel Market Update has never had a month where we failed to grow. Those reading our newsletter total in the thousands each time we publish – and based on our open rate (which is more than 100%) there are many hundreds (perhaps thousands) who enjoy our newsletter on a “less formal” arrangement… (hopefully they will at least attend our workshops and conferences).
In 2010 Steel Market Update expanded the scope of the organization into conferences and workshops. I felt it was important to tap the experienced steel (and financial) people I had gotten to know and respect and spread our experience and knowledge at a reasonable cost to the greater steel community.
We will conduct our 2nd Annual “Construction & Steel Summit” in Atlanta on October 10, 2011. This conference is being held in conjunction with METALCON and registration for the conference is on the METALCON website (Program is referred to on the METALCON website as “SP2” and the priority code for SMU members is “SMU11”).
We also developed two workshops where we work with smaller groups and attempt to do more one-on-one instruction about industry topics: Steel 101: An Introduction to the Making & Rolling of Steel (next workshop to be held in Dearborn, Michigan and include a tour of the Severstal Dearborn fully integrated steel mill – registration to open by late this week) and our Hedging Price Risk workshop with Andre Marshall, CEO of Crunch Risk, LLC. Our next Hedging Price Risk workshop will be held in Chicago on September 29, 2011 and then we will hold another one in New York City on November 2, 2011. The Chicago workshop is open for registration on our website: www.SteelMarketUpdate.com/Events.
So, we begin our 4th year in business. We begin the year as a small company looking to expand, prosper and grow. SMU is looking for new people within the industry who can add value to our newsletter, website, workshops and assist in our growth. We are constantly striving for new ideas, new or better ways to get our message to our members and we are looking for suggestions as to what we can do to better serve you - our members.
SMU has begun the process of development and design of what will be our 3rd website within the first four years of our existence. We are willing to pour our resources back into our company because we believe in both the product and in the future for SMU. We are not sitting back and resting on the small successes we have had to date – we are looking to innovate and find ways of adding value to our membership.
We are also looking to grow our membership. To date, we have grown without a sales organization – the newsletter, website and our existing members are what sell the product. We truly appreciate you – our members – and your recognition of the value we bring to the marketplace. By voicing your opinions to others in the industry you are helping us grow. Your efforts are truly appreciated.
Thank you for a great three years and we are looking forward to many, many more. Remember, you are never too old to think young, innovate and enjoy success.