Final Thoughts
Final Thoughts
Written by John Packard
April 16, 2018
For the ultimate prognosticators out there, individual tax returns were due today (April 17) by midnight. The IRS has had computer issues today and has extended the deadline to April 18 at midnight.
The Metals Service Center Institute inventories and shipment article in tonight’s issue will be the last one Steel Market Update will produce. The MSCI came out with new pricing and rules associated with the dissemination of service center inventories and shipment information. We were advised that the price of the product is now $10,000 per year, and SMU is not able to justify that expense without a significant groundswell of protest from our readers. If you would like for us to continue to publish the MSCI data, and wish for us to gather more information as to what will be allowed and what won’t, please contact me at John@SteelMarketUpdate.com.
As most of you know, SMU has our own service center months of supply index, which we publish in both a “Flash” report, a few days after the close of the month, and then later on as a full report. Our report has steel distributor inventories as being higher than what is being reported by the MSCI as of the end of March. Our service center inventories (flat rolled and soon plate) product will move to our Premium service later this summer. With the move by the MSCI, we will be working on expanding the data that we are collecting, increasing the number of service centers participating, and we will be working toward new data that is not being provided by the MSCI.
I knew when I started collecting service center inventory data that this would be a long-term project and could take well over a year to work out the bugs and then to gradually expand our services. I started the project in August 2017 compiling data from July 2017. The project is going as I expected when it was first started. We believe we will be introducing some surprises with this data in the coming months. Stay tuned.
Registrations for the 2018 SMU Steel Summit Conference have blasted through the 300 executives level and we continue to get multiple registrations daily. Here are some of the companies who registered on Monday of this week (those with an asterisk * denote more than one person registered from that company): Ryerson*, Nucor*, California Steel Industries, CSN LLC*, O’Neal Steel*, Agway Metals, Lozier Corp, Phillips Mfg., Hanwa American, Nucor Fabricated Products, Jensen Bridge and Supply*, Prassas Metal Products, Plateplus*, New Process Steel*, Harris Steel Company*, Hubbell* and Material Sciences Corp*.
There are 131 days to go before the start of the 2018 conference, so you have plenty of time to register and to convince your customers and suppliers that they need to be at THE place to see and be seen in the industry.
I expect our room blocks at the Marriott Gateway, Renaissance Gateway and SpringHill Suites Gateway will be gone by the end of this month, if not sooner. We are working with Marriott to block another hotel the next exit south on I-85 from Camp Creek Parkway and arrange for a shuttle to the convention center. I will let you know when that is done and available. There will also be more rooms available at the three hotels in the Gateway (convention center) complex outside of our room block. However, the price of the rooms could go well into the mid $200’s.
You can learn more about our 8th SMU Steel Summit Conference on our website by going to www.SteelMarketUpdate.com/events/steel-summit or you can contact our offices at 772-932-7538 or by email at info@SteelMarketUpdate.com
As always, your business is truly appreciated by all of us at Steel Market Update.
John Packard, Publisher
John Packard
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Final thoughts
What's the tea in the steel industry this week? Here's the latest SMU gossip column! Just kidding... kind of. Yes, some of the comments we receive in our weekly flat-rolled market steel buyers' survey are honestly too much to put into print. Some make us laugh. Some make us cringe. Some are cryptic. Most are serious. We appreciate them all. Below are some highlights from our survey results this week. Some of the comments that we can share with you are also included, in italics, in the buyers' own words, with minimal editing on our part.
Final thoughts
Last week we wrote about a brief lull in price movement, labeling it a period of wait and see. It did, in fact, turn out to be pretty brief. This week... things are little bit different. Perhaps right now we are more in a period of "hope and pray" or "Here we go, hold on to your hats."
Final thoughts
Unless you've been under a rock, you know by know that Nucor's published HR price for this week is $760 per short ton, down $65/st from the company’s $825/st a week ago. I could use more colorful words. But I think it’s safe to say that most of the market was not expecting this. For starters, US sheet mills never announce price decreases. (OK, not never. It has come to my attention that Severstal North America rescinded a price increase back on Feb. 14, 2012. And it caused quite the ruckus.)
Final thoughts
Is it just me, or does it seem like the summer doldrums might have arrived a little early? I could be wrong there. It’s possible we could see a jump in prices should buyers need to step back into the market to restock. I’ll be curious to see what service center inventories are when we update those figures on May 15. In the meantime, just about everyone we survey thinks HR prices have peaked or soon will. (See slide 17 in the April 26 survey.) Lead times have flattened out. And some of you tell me that you’re starting to see signs of them pulling back. (We’ll know more when we update our lead time data on Thursday.)
Final thoughts
Everybody has a plan… until they’ve dealt with volatility in the HRC market. While Mike Tyson’s original quote was about getting punched in the mouth, it’s unlikely the ex-champ has gone many pricing rounds with hot-rolled coil.