Final Thoughts
Final Thoughts
Written by John Packard
November 23, 2015
Tonight’s issue should have plenty of “meat on the bone” for everyone to read and re-read over the Thanksgiving Holidays. Due to the Holidays we will not publish our Thursday and Sunday evening issues. Our next full issue will be Tuesday, December 1st. However, as always, if news breaks that we feel needs your attention we will publish a special issue.
With so many steel trade suits going at the same time it should not come as a surprised that the US Department of Commerce pushed out the Preliminary Determination date on hot rolled into March. Trade attorney Lewis Leibowitz has been advising SMU and our readers all along to expect push-outs. If you want to learn more about the history of antidumping, countervailing, critical circumstances, volunatry restraint agreements and Section 201’s – and how your company should be dealing with each – come join us in Palm Beach Gardens, Florida on March 7-9, 2016 for our Leadership Summit. Top executives need to know and they can learn from an experienced trade attorney how the system works. Registration is available on our website or through our office. We have early bird rates in effect through January 1, 2016 and SMU member companies also receive a second discount.
For those wanting to learn more about the basics of the steel industry – from the making of steel from iron ore or scrap – to how the steel is sold and what affects prices, come join us in Starkville, Mississippi for our next Steel 101: Introduction to Steel Making & Market Fundamentals workshop. The workshop, which will be held on January 19-20, 2016 will include a tour of SDI Columbus steel mills which is located a short distance away from Starkville. You can learn more about our program on our website or feel free to contact our office: 800-432-3475.
We want to take this opportunity to wish all of our USA customers a very Happy and Healthy Thanksgiving Holiday with family and friends.
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
We just wrapped another Steel 101 Workshop, where you take what you learned in the classroom into the steel mill.
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.