The “new normal” is to reinvent oneself or the way you will do business going forward.
As many of you are aware, I am no spring chicken. Yet I refuse to live in the past. I learned (the hard way – through unexpected career changes) that I needed to constantly keep myself relevant to my customers. The way I think is to try to imagine what your needs are going to be in the weeks, months and years ahead. This pandemic has just added a new sense of urgency to the way I see our relationship through the continued development of the SMU “community,” and the group of products we have to offer those in the industry that SMU covers.
Last week you heard me talk about what will be the first SMU “Virtual” Steel Summit Conference. This will be no small project. If we are going to go down this road, I want to bring a product to you that offers value – perhaps even exceeding that of our “live” conference (which is already the largest flat rolled and plate steel conference in the Western Hemisphere).
Let me back up a second to inform those who missed last Thursday’s Final Thoughts – a decision on whether we will host our Aug. 24-26 conference at the Georgia International Convention Center in Atlanta will not be made until June 1. By then we should have a better feel for if we can conduct a “safe” conference and what that would entail. Whether we conduct a live conference at the GICC or not will not influence our decision to conduct a “virtual” online conference over the same three days.
The next 15 weeks are going to be quite interesting, and I hope you will join me on the journey.
When I built the original SMU Steel Summit Conference, I believed a conference had to bring some key values to attendees in order to keep them coming back for more: access to decision-makers, quality speakers discussing topics of interest to the audience, a good environment without too many distractions and plenty of time for networking at a reasonable price.
The SMU “Virtual” Steel Summit Conference is going to be built with each of these keys in the forefront of our minds. Our vision is to provide an environment where you miss nothing – no longer will you be forced to miss a portion of the program because you are in a meeting outside of the meeting room. You will also have opportunities to interact with other attendees, have live chats – introduce yourself to someone new. You will have more time to make appointments before the conference, during the conference and after the conference is over.
Stay tuned for more in the coming days, weeks and months. We have 15 weeks to go before show time!
We have just a couple of days before our next SMU Community Chat Webinar, which will feature Dr. Chris Kuehl, Managing Director of Armada Corporate Intelligence. Join me and Dr. Kuehl at 11 a.m. on Wednesday, May 13. You can register for this week’s free webinar by clicking on this link.
I saw the CEO of Carrier Corporation speaking to CNBC on Friday morning. He believes the housing market in the United States will be down 15-20 percent. He was asked if demand is being “pushed out” or “eliminated” due to the pandemic. He felt that the U.S. recovery would not be the same as China, which appears to be going through a “V” shaped recovery. The U.S. will have a shallower drop in demand (China was 50 percent for Carrier) but it will take much longer to return to pre-COVID-19 levels. He also mentioned that when dealing with labor issues and proximity, this may move more manufacturing toward robotics.
If you are looking to renew your membership, or if you would like to become a new subscriber, please reach out to Paige Mayhair at 724-720-1012 or by email: Paige@SteelMarketUpdate.com . You can also reach out to Jill Waldman at 303-570-6570 or by email: Jill@SteelMarketUpdate.com
As always, your business is truly appreciated by all of us here at Steel Market Update.
John Packard, President & CEO
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What are some “Black Swans” to watch out for? With the war in Ukraine entering its third year, your mind might understandably move to conflicts overseas. Here is one closer to home to consider: US trade relations with Mexico taking a turn for the worse. I mention that because the Office of the United States Trade Representative (USTR) dropped a (virtual) bombshell earlier this month.
Domestic prices have been sliding since the beginning of the year, and I don’t see any obvious reasons why the slide might stop this week. But let’s put the timing of a bottom aside for a minute. The question among some of you seems to be whether we’ll see another price spike, or at least a “dead-cat bounce,” before the typical summer doldrums kick in.
I’ve had discussions with some of you lately about where and when sheet prices might bottom. Some of you say that hot-rolled (HR) coil prices won’t fall below $800 per short ton (st). Others tell me that bigger buyers aren’t interested unless they can get something that starts with a six. Obviously a lot depends on whether we're talking 50 tons or 50,000 tons. I've even gotten some guff about how the drop in US prices is happening only because we’re talking about it happening.
We’ve all heard a lot about mill “discipline” following a wave of consolidation over the last few years. That discipline is often evident when prices are rising, less so when they are falling. I remember hearing earlier this year that mills weren’t going to let hot-rolled (HR) coil prices fall below $1,000 per short ton (st). Then not below $900/st. Now, some of you tell me that HR prices in the mid/high-$800s are the “1-800 price” – widely available to regular spot buyers. So what comes next, and will mills “hold the line” in the $800s?
Everyone knows the old saying that “a picture is worth a thousand words.” Just because it’s a cliché doesn’t mean that it’s wrong. A lot of inked has been spilled trying to figure out why prices are falling now. I thought it might be as simple as this: Market dynamics in the fourth quarter (UAW strike, companies buying ahead of an anticipated post-strike price spike, etc.) pulled forward restocking activity that typically happens in the first quarter.