Final Thoughts
Final Thoughts
Written by John Packard
September 11, 2013
The process of populating, testing, editing, fixing, testing, editing, adding content, editing, testing – well, you get the idea…. The website work continues and we continue to strive to meet the Friday the 13th deadline. My gut is telling me a week late may be a better target – but, we are going to try to get as much done and ready within the next few days as possible.
We have been testing the new newsletters for a few weeks now. This evening will be the first time we test an interactive graphic within the newsletter (sorry, you won’t be able to view it until we go live). This is one of the unique features we are building into the newsletter and elsewhere on our website. The idea of our clients being able to manipulate the time series of the data we are presenting appealed to me.
We have mentioned previously that our intention is to come up with three products: our Executive Newsletter – which is the newsletter we have been publishing all along, our Monthly Newsletter – which you have seen the first two issues which we have provided as complimentary until the website comes up and then we will have a Premium Product. The Premium Product is less about a specifically designed newsletter and more about having access to data and analysis that SMU has been collecting over the years. This includes access to a portion of our steel market surveys and history, analysis of data collected from U.S. government and other sources (such as our Key Market Indicators), special products such as our imports by product, port and country (hot rolled produced in tonight’s issue) and more. The Premium Product is not meant for the everyday reader (nor is our Monthly Newsletter). The core product will continue to be our Executive Newsletter.
We have provided a couple of articles this evening by Peter Wright which contain more data and analysis than what we have produced in the past. The Apparent Steel Supply article is one example that we be focused on those who are interested in data and working with the data for a clearer picture of the market. This is focused on those who would be interested in our Premium Product.
We hope you find the site interesting and adds value to your membership. Now we just need to get it online so you can see for yourselves….
As always your business is truly appreciated by all of us here at Steel Market Update.
John Packard
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Final Thoughts
Steel equities and steel futures fell hard after news broke earlier this week that the US and Mexico might reach an agreement that would result in the 50% Section 232 tariff coming off Mexican steel. The sharp declines didn’t make much sense, especially if, as some reports indicate, Mexico might agree to a fixed quota. They didn't make sense even if steel flows between the US and Mexico remain unchanged.
Final Thoughts
Even before the news about Mexico, I didn’t want to overstate the magnitude of the change in momentum. As far as we could tell, there hadn’t been a frenzy of new ordering following President Trump’s announcement of 50% Section 232 tariffs. But higher tariffs had unquestionably raised prices for imports, which typically provide the floor for domestic pricing. We’d heard, for example, that prices below $800 per short ton for hot-rolled (HR) coil were gone from the domestic market – even for larger buyers.
Final Thoughts
I want to draw your attention to SMU’s monthly scrap market survey. It’s a premium feature that complements our long-running steel market survey. We’ve been running our scrap survey since late January. And over just that short time, it’s become a valuable way not only for us to assess where scrap prices might go but also to quantify some of the “fuzzy” indicators - like sentiment and flows - that help to put the price in context.
Final Thoughts
I think there is an obvious case for sheet and plate prices going higher from here. That’s because, on a very basic level, the floor for flat-rolled steel prices, which is typically provided by imports, is now significantly higher than it was a week ago.
Final Thoughts
We're about to hit 50% Section 232 steel tariffs. What could happen?