Final Thoughts

Final Thoughts
Written by John Packard
October 29, 2014
I adjusted the SMU Price Momentum Indicator from Lower to Neutral in recognition of the attempt by the domestic steel mills to reverse the price trend and move prices higher. A Neutral indicator means prices could move in either direction (or remain stable) over the next 30 days.
I understand two mills have made very modest price announcements of $20 per ton (AK Steel & US Steel). A third mill, Nucor, began verbally telling their customers today that their prices are up $20 per ton. However, I have not yet seen some of the other mills, who would normally fall in line with the AK and USS moves, making their announcements.
The initial reaction from steel buyers is generally supportive (service centers) although not necessarily enough to create a surge of buying at the higher numbers. We will have to watch and see what the “tone” of negotiations will be in the coming days. So far we are hearing the attempts to “push” prices as being somewhat feeble.
One of the coated service centers (galvanized & Galvalume) when asked about any new price announcements informed SMU that there were none. At the same time he pointed out the huge disparity between pricing in the south and that being seen in the Midwest and Great Lakes region of the U.S. He pegged the variance at close to or exceeding $100 per ton ($5.00/cwt).
Coated lead times from non-automotive steel mills are in late November and into December.
I will see what I can learn as I mingle with service centers attending the Association of Steel Distributors (ASD) meeting in Las Vegas beginning this evening.
As always your business is truly appreciated by all of us at Steel Market Update.
Got someone in the industry who hasn’t been able to find the time to become a SMU subscriber? Maybe you have a customer or supplier who doesn’t know what you are talking about when you mention Sentiment or our Price Momentum Indicator. If so, it sounds like they would be a good candidate as a company you should suggest to become a subscriber to our newsletter. When they do register make sure they put your company name in our “referral” box to insure your company will receive the $100 credit. The referral credit can be used on any workshop, conference, upgrade or renewal within 12 months of issue. If you have any questions please contact us at: info@SteelMarketUpdate.com
John Packard, Publisher

John Packard
Read more from John PackardLatest in Final Thoughts

Final Thoughts
The difference: The spat with Turkey was a big deal for steel. This time, the 50% reciprocal tariff for Brazil – if it goes into effect as threatened on Aug.1 – hits everything from coffee and to pig iron. It seems almost custom-built to inflict as much pain as possible on Brazil.

Final Thoughts
Are we on the cusp of sorting out the tariff situation, or is this merely another round in the bout?

Final Thoughts
I’m not sure how many different ways I can write that it’s been a quiet market ahead of Independence Day. There are variations on that theme. I’ve heard everything from the ominous “eerily quiet” to "getting better" and even the occasional “blissfully unaware” (because I’m enjoying my vacation).

Final Thoughts
What's going to be the next big thing in steel?

Final Thoughts
Based on the amount of ‘out of office’ replies we’ve been receiving and the results of this week’s steel buyers’ survey, those pesky summer doldrums have arrived for the steel industry.