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    Analysis

    May 4, 2016

    Final Thoughts

    Written by John Packard

    I had a long conversation with a service center this afternoon regarding the steepness of the rise in flat rolled prices out of the domestic mills. This buyer was frustrated with the pace of the increases and the unnecessary (in his opinion) tension the increases have caused between their company and their customers.

    During the conversation he pointed to a prediction by World Steel Dynamics in a marketing piece for their June conference whereby they state, “What’s next? It’s time for “the chill” to set in, with the steel market going from ebullience to panic, or vice versa, depending on one’s seller/buyer perspective. Starting, most probably in May and, for sure in June, WSD expects the price to stabilize and, then, begin a substantial decline. The low point for the HRB export price this fall could be $300-$320 per ton.”

    John Packard

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