Final Thoughts
Final Thoughts
Written by John Packard
April 18, 2016
We should see the pace of the price increases slow down as most mills are getting the announced minimum price levels from their spot buyers ($25.00-$26.00/cwt HR, $35.00/cwt cold rolled and coated). The market needs a couple of weeks to absorb the increases and push them down to the end users and resale spot customers.
I spoke with an HVAC wholesaler this afternoon about their ability to collect price increases from their mechanical contractor customers. The reason why I reached out to a wholesaler is due to my relationship with the group through my HARDI membership. HVAC mechanical contractors have become the bottom of the spot market over the years (due to too many companies supplying the same products to the industry). What the wholesaler told me today was, “We haven’t seen anything like this in at least four years. It’s not a runaway train like it has been in the past but, we are getting our number.”
When pressed the wholesaler told me they were now selling off replacement costs plus their normal margins. If customers aren’t willing to buy they are waiting them out or allowing their competition to blow off inventory that would have been worth more in the coming days and weeks.
A note about our Steel 101: Introduction to Steel Making & Market Fundamentals workshop. The workshop is still a month away but we are within one or two people from selling out the space available. The roster is excellent and we are looking forward to working with our friends at North Star Bluescope Steel. Dates for the workshop are May 17-18th. Details can be found on our website.
The next Steel 101 workshop will be a special edition as it will be held in Memphis, Tennessee and include what we think will be a once in a lifetime tour of Big River Steel. We will have more details on this workshop over the next few weeks. We have already received reservations from companies for this workshop. We expect it will be very popular.
Speaking of popular, our 6th Steel Summit Conference is gaining traction with only 131 days to go. Registration is open and we recommend booking as early as possible. You can also book through our office: 800-432-3475. Kick-off begins on Monday afternoon, August 29th and ends at 4 PM August 31st. Details are on our website.
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
SMU has heard from some larger buyers who have stepped back into the market to buy at prices that, if not at a bottom, they assess to be close to one. Is it enough to stretch out lead times and send prices upward again? Or do we continue to scrape along the mid-$600s per short ton (st) as we have been doing for most of the last month?
Final thoughts
Cleveland-Cliffs Chairman, President and CEO Lourenco Goncalves had some insightful things to say today about the steel market and about a conference we suspect might be Steel Summit.
Final thoughts
They say a picture is worth a thousand words. Well, when you add in some commentary from respected peers in the steel industry to those pictures, that may shoot you up to five thousand words, at least. In that spirit, we’ve added some snapshots from our market survey this week, along with some comments from market participants.
Final thoughts
I thought we’d have more clarity this week on Section 232, Mexico, and a potential carve-out for steel melted and poured in Brazil. As of right now, the only official comment I have is from the Office of the United States Trade Representative (USTR).
Final thoughts
There are just 40 days left until the 2024 SMU Steel Summit gets underway on Aug. 26 at the Georgia International Convention Center (GICC) in Atlanta. And I’m pleased to announce that it's official now: More than 1,000 people have registered to at attend! Another big development: The desktop version of the networking app for the event has officially launched!