Final Thoughts

June 12, 2020

Every other week Steel Market Update conducts an analysis of the flat rolled and plate steel market trends. This is done via a comprehensive questionnaire, invitations for which are sent to more than 600 individuals representing more than 550 companies. We intentionally weight the invitations heavily to individuals from manufacturing and steel service centers. Combined they represented 80 percent of the responses made in last week’s survey (40 percent for each). The balance of the responses came from steel mills (7 percent), trading companies (8 percent), toll processors (4 percent) and other suppliers to the industry (1 percent).

We asked questions on a myriad of topics including current and future sentiment, mill lead times, mill negotiations, steel pricing, demand, service center spot prices, trading company and steel mill related items and much more.

We concluded last week’s analysis on Thursday. One of the questions concerned where steel buyers think steel prices will move over the next 60 days. Fifty-three percent of the the buyers and sellers of steel who responded believe prices will stall at current levels. We found 37 percent are of the opinion prices will continue to rise, while only 10 percent felt prices will slide from here.

It has been some time since SMU inquired as to the strength of President Trump’s support amongst the steel community. With all that has happened since the beginning of the year, we were curious to see if the president’s support levels had tapered off. What we found is the president continues to have a large portion of the steel community on his side. We found 62 percent of our respondents are supporting Donald Trump for a second term. Joe Biden only garnered 12 percent, while 22 percent did not yet know who they were going to support and 4 percent responded “other.”

During our conference, which is being held the same time as the Republican National Convention in Jacksonville, Fla., we will check again to see if the president’s support remains or if the race tightens.

Our survey also asked service centers if they were having difficulties passing along the new higher prices (due to mill price increases) to their customers. We have been asking this question ever since the mills began attempting to move prices higher, and as you can see by the graphic below we are getting similar results, which does not play well for higher mill prices for too much longer.

SC passing along higher prices 6.14.2020

All the data provided from last week’s flat rolled and plate steel trends analysis is available to our Premium members. You can learn more about upgrading to Premium by contacting Paige Mayhair at 724-720-1012 or Paige@SteelMarketUpdate.com

Now I want to take the liberty of being a proud father to my musician son. My son is a percussionist with a degree from Oberlin Conservatory and a masters from McGill in Montreal. He performs and composes contemporary music and jazz. One of his jazz records, “The Early Bird Gets,” was recently written up as the best new jazz album by the Sydney Morning Herald. You can read their review by clicking here. You will need to scroll past the Lady Ga-Ga review of her album (which at 3.5 stars was rated lower than my son’s at 4.5 stars…).

If you would like to listen to Ryan Packard’s music, which is a collaboration with saxophonist Dave Rempis and bass player Brandon Lopez, you can click here.

This Wednesday at 11 a.m. ET the SMU Community Chat webinar will host Donald Bly of Applied Value. Applied Value is a company that works with buy side customers, thus giving them insights into how OEMs are reacting to today’s market, price negotiations and on subjects such as reshoring. I think you will find his insights interesting and potentially helpful to your business. You can click here to register for the free webinar.

As always, your business is truly appreciated by all of us here at Steel Market Update.

John Packard, President & CEO