Final Thoughts
Final Thoughts
Written by John Packard
April 28, 2017
I have received a number of comments on the LinkedIn posts that I have put out there over the weekend. I shared our “Black Swan” article on my personal LinkedIn account as well as our Steel Market Update LinkedIn group account. I also received a question about the “average margin for a service center” that prompted a few comments. If you have not linked with me you are welcome to do so. You can also find Steel Market Update on Facebook and Twitter. Our Twitter account is SMUsteel and you are more than welcome to follow our tweets.
On Monday we will begin our early May flat rolled steel market trends survey. Invitations should go out at 8 AM ET. If you receive an invitation please take a few minutes, click on the button contained in the message, and provide us your opinions on the flat rolled markets.
Here are some of the companies who have already registered for the 2017 SMU Steel Summit Conference: Nucor, Pacesetter, NCI Buildings, Conklin Metals, Priefert Steel, Ratner Steel, Mill Steel, Steel Technologies, Honda North America, Honda Trading America, Kandil Steel (Egypt), Ternium, CTB, Lafayette Steel & Aluminum, Philips Mfg, Behlen Mfg, BTD, Zekelman Industries, Koike Aronson, Berlin Metals, All Weather Insulated Panels, Smallwood & Associates, Feralloy Corporation, Central States, Southwark, Heidtman Steel, ACM Metals, Material Sciences, CMC Cometals Steel, Omni Steel, Hirsh Industries, GAMS, NB Handy, Hanwa America, Steel Dynamics, Red Bud Industries, Bank of America, Wabash National, Phoenix Metals, ABB Thomas & Betts, Magic Coil Products, NLMK USA, Owen Industries, BlueScope Steel Americas, Reliance Steel & Aluminum, Magic Steel, Magna Powertrain, Lifetime Products, Viking Materials, Steel Warehouse, ThyssenKrupp, Vicwest Building Products, Osmundson Manufacturing, Nordfab LLC, Coilplus, Samuel & Son, New Process Steel, American Metals Supply, Olympic Steel, Severstal Export Miami, Commercial Metal Forming, Andes Coil Processors, MRI Steel Framing, Metal Resources Holding Company, Nucor Canada, Imperial Manufacturing, Macsteel International, Bradford Research, World Steel Dynamics, CRU, Midwest Pipe & Steel, DMI Companies, ArcelorMittal Dofasco, Sheffield Steel, Webco Industries, Greif/Colonial Metal Products, Majestic Steel, Tempel, Ryerson, Metal Edge Partners, Central Steel & Wire, Cleveland Steel Container, MidWest Materials, Ternium International USA, Smallwood & Associates, Aaristic Services, ArcelorMittal Mexico, Steel Manufacturers Association, Big River Steel, Association of Steel Distributors, Applied Value, Cato Institute, Lewis Leibowitz, Institute for Trends Research, Cargil Metals, Nashville Wire Products, Trinity Industries, The Steel Index, Metalminer
Many of the companies listed are bringing multiple people to the conference. Total registrations right now are approximately 220 people and we are well on our way to our 500+ person goal. Our room block at the Marriott Gateway Hotel is shrinking so you need to make your reservations soon. There are 119 days before the start of the conference.
If you did not see your company name on the list and you think it should be there contact us at 772-932-7538. If you are unsure if your name is registered as an attendee please contact us at that same number or by email: info@SteelMarketUpdate.com. If you would like an invoice please contact Diana or Alison at 772-932-7538 or info@SteelMarketUpdate.com
If your company is registering multiple people one at a time, please contact us for a special code that will insure the website charges you the correct group rate.
To register go to our website: www.SteelMarketUpdate.com/Events/Steel-Summit or click on this link for a single registration or this link for a group registration.
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?