Final Thoughts
Final Thoughts
Written by John Packard
February 15, 2017
News for those attending this year’s SMU Steel Summit Conference, we will have free Wi-Fi for everyone attending. This will allow attendees to interact easier with other attendees and with our polling and other features on the SMU App. The SMU App will also have some new features this year and we will write about those in the coming weeks. Early registrations have been surprisingly brisk 193 days prior to the beginning of the conference. You can learn more about our conference, browse the speakers as we add them to the growing list, review what companies attended last year and find information regarding the costs associated with attending this year’s event. The dates are August 28-30, 2017. The conference will begin with a “Pre-Summit” segment which will be conducted at the Atlanta Airport Marriott Gateway Hotel on Monday afternoon so you will want to plan to arrive into ATL in the morning or early afternoon. There will be plenty of people to network with in the lobby of the hotel as the afternoon. Last year we had 200 people in our Pre-Summit segment and we expect this year to reach 300. If you have questions please feel free to contact me at: 800-432-3475 or John@SteelMarketUpdate.com
I mentioned the other day that a manufacturing company CEO with whom I had breakfast on Monday mentioned Jeffrey Gitomer and some of his quotes on business. I looked him up and found a few more quotes that you might find useful, “Your customers are judging every aspect of every transaction and rating everything, from friendliness of people to ease of doing business to quality of product to service after the sale.”
Another quote, “In sales, it’s not what you say; it’s how they perceive what you say.”
Enough said.
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?