Final Thoughts
Final Thoughts
Written by John Packard
July 21, 2017
Boy, am I receiving mixed messages – more than I think I ever have before during my 40 year plus career in (or covering) the industry. My opinion is the mixed messages are due to the interference in “normal” market operations by the Trump administration. This is especially destructive when promises are made for Section 232 recommendations and the date goes by with nothing. At the same time, the president is telling people that the steel industry is going to be so happy with what he is going to do, and nothing gets done. The creates indecision within the industry.
So, on one hand we have the domestic steel mills announcing higher steel prices and, at the same time I have a conference call with HARDI wholesalers who tell me that prices have barely budged and competition from service centers indicates no issues with inventories. There is plenty of steel on the service center floors according to SMU sources. MSCI sees it differently. More mixed messages.
When looking at our survey results we found the approximately 50 service centers responding to last week’s questionnaire reporting inventories at 2.3 months. Thirty-seven percent of those same distributors reported having “off the books” inventory which makes capturing the accurate inventory levels that much more difficult. We will have more on this subject in Tuesday evening’s newsletter.
Another busy week ahead. I will be in my office all week working on pricing, reaction from the market, foreign steel offerings and service center inventories. Stay tuned.
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!