Final Thoughts
Final Thoughts
Written by John Packard
June 7, 2019
This coming week will be a full week when I will be in my office. I am ecstatic. As with most weeks, this coming one will be spent trying to figure out what will cause this market to turn around. On Tuesday, I will publish our analysis of service center spot pricing to their end customers based on last week’s flat rolled and plate steel market trends survey. Have we reached the point of capitulation? If so, how much longer can service centers continue to drop prices and dump inventory? For that matter, how much longer (and lower) can the domestic mills go before they have no choice but to try to change momentum and move prices higher (or at least stabilize them)?
One of the other items I am working on this week is finishing negotiations to select our next Steel 101 workshop, which I anticipate will be held during the later part of September.
Registrations for the 2019 SMU Steel Summit Conference are approaching 700 with a little more than two months to go. I want to remind everyone who has not made hotel reservations that as of late last week we still had rooms at the Atlanta Airport Marriott (not the Gateway) which is located one exit south of the convention center. We will be running a shuttle between that hotel and the convention center during the conference. There may also be a few rooms left at the SpringHill Suites Gateway Hotel. You can use the links for the hotels by clicking on them. We also have lodging links on our website for our room blocks: www.SteelMarketUpdate.com/events/steel-summit (click on the lodging tab).
I want to welcome our newest members and I encourage you to interact with us should you have a question or suggestion. We look forward to speaking with all of our members. You can reach us at info@SteelMarketUpdate.com
If you want information about becoming a subscriber, or wish to renew or upgrade an existing membership, please contact Paige Mayhair at 724-720-1012 or Paige@SteelMarketUpdate.com
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John Packard, President & CEO
John Packard
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Final Thoughts
Another day, another massive gap between the news and market sentiment. On the news side, we’ve got war in the Middle East. The devastation facing western North Carolina coming into tragic focus. And the outcome of the presidential election remains a coin toss, according to current polling.
Final thoughts
There are markets where the headlines and the prices are both crazy. This does not appear to be one of them, at least not yet.
Final thoughts
Washington loomed large in our surveys this week. Two things actually: the upcoming presidential election and the trade case against imported coated products from 10 nations.
Final thoughts
Thanks to everyone who attended our Steel Hedging 101 workshop in Chicago on Wednesday. I learned a lot from StoneX Group’s Spencer Johnson, who instructs the course, and from your good questions. One thing that Spencer said sticks with me as I write this column. Namely, that momentum drives steel prices more than other commodity markets. If you watch steel futures, you’ll see up days and down days. But it’s rare to see the momentum shifting back and forth within any given day.
Final thoughts
SMU's prices ranges for flat-rolled steel were mostly sideways on Tuesday even as futures market shot higher. I got some questions as to why hot-rolled (HR) coil futures shot higher. As best as I can tell, it might have been in response to news that China plans to roll out stimulus measures. We have details on those measures here thanks to our colleagues at CRU. The chart below gives you some idea of just how sharply upward the move in HR futures was earlier on Tuesday: