Final Thoughts
Final Thoughts
Written by John Packard
October 2, 2015
One of the reasons SMU decided to go with an App for our Steel Summit Conference this year was the belief that the App was something that could be used prior to the conference as well as after the conference. For example, earlier today I was working on developing scrap information in relationship to iron ore (spot in China) and billet prices delivered to Turkey. I remembered that Pete Meyers of Metalico had spoken on the subject so I went to the App, clicked on the Agenda, found his presentation and reviewed his slides which then prompted me to ask him a couple of questions.
For those of you who attended our 2015 Steel Summit Conference, the App is still alive and you can still access power point slides and send emails to attendees or speakers with any questions you might have.
We think this will also be a bonus for those of you who will be attending our 2016 Steel Summit Conference (scheduled for August 30-31, 2016 in Atlanta) as you will have access to what was said last year as well as the new material once the conference is in full swing.
We will begin our early October flat rolled steel market analysis at 8 AM ET on Monday morning. If you receive an invite to participate please click on the link (button) contained in the message and you will be redirected to the questionnaire. I thank you in advance for helping us to better understand the flat rolled steel markets.
I will be traveling to Davenport, Iowa on Monday where I will meet up with the rest of our Steel 101 instructors: John Eckstein and Steve Painter who are flying out of Baltimore, Peter Wright who comes from Dallas/Ft. Worth and Mario Briccetti who joins us from Rhode Island. We are looking forward to our workshop and our first tour of the SSAB facility located about 30 minutes away.
I want to welcome our newest members and I want to take a moment to let you know that I encourage questions, comments and suggestions from our members. If there is something on your mind please let us know. You can reach us at: info@SteelMarketUpdate.com.
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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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?