One thing that we learned from the earnings conference calls which were conducted over the past two weeks: the domestic steel mills will be entering 2015 with all of their blast furnaces online, maintenance completed and (hopefully) running well. Barring any unforeseen circumstances we should have plenty of domestic supply going into the traditionally strong first quarter. The question now will be will demand match up well with supply and how will the flood of imports that we have seen during the second half of 2014 impact the supply/demand fundamentals?
Iron ore prices continue to sag below $80/dmt (dry metric ton) in the spot markets in China. One year ago 62% Fe ore was selling on the spot market at $135.9/dmt (The Steel Index). At the beginning of the year ore was $135.0/dmt (1/2/2014). Ore broke through $100/dmt on May 19th when it traded at $98.5/dmt. Spot prices broke $90/dmt on June 16th when 62% Fe fines traded at $89.0/dmt. It took until September 22nd before ore broke through the $80 mark when it hit $79.8/dmt. Last Friday the spot price was $75.5/dmt and many are forecasting ore could hit $70/dmt.
A reminder that our next Steel 101 workshop is in January. A workshop for those new to the industry, changing positions or just wanting to learn more about the process of making steel, understanding how different qualities are produced, how steel is rolled, sold (flat and long products) and what impacts pricing. We also spend time looking at what is available online to help you assess the markets, whether you are a brand new salesperson or the head of marketing. Our next workshop will be held on January 20 and 21, 2015 in Mount Pleasant, South Carolina which is right next to Charleston, South Carolina and pretty close to Berkeley where we will be taking a mill tour compliments of Nucor. Registration is open and just waiting for you (or one of your people) to sign up…
I am in New York City on Monday through Wednesday of this week. On Thursday and Friday I will be in Savannah, Georgia attending the AWMI conference. In my absence Diana and Brett will be keeping SMU HQ staffed and ready to serve our customers. If you need to reach me you can get me by email: John@SteelMarketUpdate.com.
As always your business is truly appreciated by all of us at Steel Market Update. Tell your friends and steel contacts about us…
John Packard, Publisher
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Sometimes a journalist’s life comes with unexpected perks. That is, beyond the day-to-day of writing stories, a wayward email can come across the Inbox with an attractive invite, and the promise of free food.
There has been almost an assumption that US mills would get the $950-1,000 per ton ($47.50-50 per cwt) they were seeking on HR base and $1,150-2,000 per ton ($57.50-60 per cwt) for cold-rolled and coated base. Recall that Cliffs initially announced an increase and said it was seeking $1,000 per minimum for hot-rolled coil. Nucor […]
United Auto Workers (UAW) members have ratified a new labor contract with Detroit-based General Motors, the largest US automaker. In other words, the UAW strike that began on Sept. 15 - and that rattled the steel industry in the months leading up to it - is almost in the rear-view mirror.
Sheet prices are up again. That shouldn’t come as a surprise on the heels of mill price hikes, scrap settling up and expected to move higher over the next few months, and inventories – as our premium subscribers will learn tomorrow – moving lower for a third month.
Cleveland-Cliffs announced it would seek a minimum base price of $1,000 per ton ($50 per cwt) for hot-rolled coil (HRC) on Nov. 7. Nucor said a day later that it was aiming for $950 per ton. Why didn’t Nucor follow Cliffs up to $1,000 ton? I think there might be some possible answers in our […]