Final Thoughts
Final Thoughts
Written by John Packard
December 22, 2014
This will be our last issue before Christmas and the last day of Hanukkah. We wish each and everyone one of you and your family all the best over the Holidays.
I drove from Atlanta to Chicago over the weekend as we prepare to celebrate the Holidays with our son. One of the first gifts we have seen was the cost of gasoline on our drive north from the Atlanta area. The lowest gasoline prices were found in Lafayette, Indiana where we paid $1.96 per gallon for regular unleaded, even though the station across the steel was advertising $1.95 per gallon. I think the total cost for gas to drive from just north of Atlanta, Georgia to downtown Chicago, IL was in the area of $50 in my SUV. It used to cost me $50-$60 to fill the tank once…
T. Boone Pickens this morning on CNBC predicted that the U.S. would loose about 500 oil wells within the next 6 to 12 months. He said the drillers will not cap existing wells. The decline will come in the drilling of new wells.
Pickens called OPEC a “trade organization” and no longer a cartel.
The oil price decline is a boon for the American consumer and for industry, with the exception of the energy sector. With the potential decline of up to 500 oil wells the pipe and tube industry (OCTG) will be negatively hit. This will impact the amount of domestic hot rolled tonnage being produced for the industry. The energy sector has been one of the largest users of steel products over the past few years. This is one of the reasons why our Price Momentum Indicator is pointing toward lower prices over the next 30 days.
Even though our offices may be closed over the next couple of days and we are not producing any newsletters on Thursday or Sunday, you can register for our Steel 101 conference on our website. Click on this link or go to our website and click on any of the Steel 101 links on the Home Page under Events.
One piece of information that those interested in possibly attending one of our Steel 101 workshops – the January 20 & 21, 2015 workshop will be the first time we will tour both a sheet mill (flat rolled) as well as a bar mill (long products). Two production facilities for the price of one! If you have any questions send them to: info@SteelMarketUpdate.com and we will address them over the Holidays.
Everyone stay safe, enjoy your friends and family and have a peaceful and Merry Christmas and Hanukkah.
As always your business is truly appreciated by all of us here at Steel Market Update.
John Packard, Publisher
John Packard
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Sheet prices didn’t roar back after Labor Day. But steel market news sure came out of the gate strong (or maybe chaotically is the better way to put it). First, the nearly $15-billion proposed sale of U.S. Steel to Nippon Steel exploded into the news. And when I say exploded, I mean that all sides seem to be escalating things now.
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Welcome back from Labor Day, from Steel Summit, and from whatever fun you might have had over the long weekend. Personally, I enjoyed camping with friends and family near Starved Rock. No one starved, there were no major injuries, and we enjoyed the many splendors of Mystical Fire. (Speaking of which, does that have industrial uses? But I digress.)
Final thoughts
I want to say a huge ‘thank you’ from all of us at SMU to all of you (more than 1,500!) who attended Steel Summit this year. We appreciate you taking time out of busy schedules to join us – whether that was up on stage, submitting thoughtful questions, or catching up over a drink and bite to eat. Also, a bit shoutout to everyone at SMU and at CRU who made this event possible. It’s no understatement to say that we have a fantastic team.
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Day one and two of SMU's Steel Summit 2024 are officially in the books. We covered a lot of ground, and the agenda sure did deliver.
Final thoughts
The big show is just about here. SMU Steel Summit will be getting underway on Monday. Where does the networking begin? I’d say at the airport. So don’t forget your business cards. And it can't hurt to wear a company golf shirt.