Final Thoughts

Final Thoughts

Written by John Packard


For our U.S. customers, welcome back from the Thanksgiving Holiday. We are a little more than three weeks from our next break for the Christmas and New Year Holidays. Then we plow into 2016 and my gut tells me by then things may begin to change. We still have our SMU Price Momentum Indicator pointing toward lower flat rolled steel prices but, well, we will wait and see what happens as scrap negotiations get underway for December (and snow flies in the Midwest)…

I was sorry to see the email from the General Manager of CRU’s steel business who informed me on Thanksgiving Day that they would no longer support our re-publishing of their hot rolled, cold rolled, galvanized and plate indices. They told us, “Our view is that publishing our prices to potential customers, for what is a small sum of money, is not to our advantage.” They also advised us that they will enforce their copyright, “…Copyright on our prices is something we are pursuring (sic) vigorously and this has proven costly for some people who did not take it seriously…” So, there you have it.

In the future we will no longer reference CRU on our website or in our newsletter. Not because of the threat of a lawsuit (which they made quite clear they would, so my lawyers are already involved) but because there are other options out there and we will leave that up to the steel community to decide what works best for each relationship and what is the most transparent and trustworthy for your needs.

To be fair to CRU they did tell me that they did not have any problems with SMU or me personally. This was a business decision on their part. I hold no ill will toward CRU as they have a right to run their business as they wish.

The relationship between CRU and SMU officially ends on December 17th. You are welcome to voice your views on the subject which you can do by sending me an email: John@SteelMarketUpdate.com.

I already am working on something to replace CRU that I think will bring more value to our readers, as the real goal is to be able to view the movement of prices and trust the rate of change at any point in the marketplace. I think our own flat rolled steel indices have proven themselves to be reliable against all of the other indexes but I continue to prefer that it not be used in financial transactions. This might change in the future should we decide to grow our staff and our ability to index a wider variety of products. The marketplace will determine whether there is a need (and a willingness to pay a reasonable fee for the service). Again, you can voice your opinion by sending me an email.

I want to take a moment to welcome both our newest member companies as well as the large group of people who have opted to trial our product. I want to remind everyone that we are receptive to receiving questions, comments and suggestions from anyone who is interacting with our newsletter or website. You can reach us at: info@SteelMarketUpdate.com and we will answer your queries to the best of our abilities.

As always your business is truly appreciated by all of us here at Steel Market Update.

John Packard, Publisher

 

 

 

 

Latest in Final Thoughts

Final thoughts

I’ve had discussions with some of you lately about where and when sheet prices might bottom. Some of you say that hot-rolled (HR) coil prices won’t fall below $800 per short ton (st). Others tell me that bigger buyers aren’t interested unless they can get something that starts with a six. Obviously a lot depends on whether we're talking 50 tons or 50,000 tons. I've even gotten some guff about how the drop in US prices is happening only because we’re talking about it happening.

Final thoughts

We’ve all heard a lot about mill “discipline” following a wave of consolidation over the last few years. That discipline is often evident when prices are rising, less so when they are falling. I remember hearing earlier this year that mills weren’t going to let hot-rolled (HR) coil prices fall below $1,000 per short ton (st). Then not below $900/st. Now, some of you tell me that HR prices in the mid/high-$800s are the “1-800 price” – widely available to regular spot buyers. So what comes next, and will mills “hold the line” in the $800s?