Final Thoughts

Final Thoughts

Written by Tim Triplett


Our thoughts and prayers go out to the millions of people on the West Coast who are suffering the threat and devastation of historic forest fires. The loss of life and property is staggering. And the blow to business and commerce in the region has yet to be measured. Face masks are doing double duty against COVID and smoke. There’s limited information at the moment, but Steel Market Update will try to report on how the fires are impacting manufacturing in California and Oregon in upcoming issues.

The Commerce Department will host a series of webinars on how to use its new SIMA import monitoring system. More information about the webinars can be found at https://www.trade.gov/updates-steel-import-licensing.

As trade attorney and SMU columnist Lewis Leibowitz explains elsewhere in this issue, Commerce is launching a new Steel Import Monitoring and Analysis (SIMA) system, effective Oct. 13. The new system will require that importers document not only where the finished steel product came from, but also where the substrate used to make it was originally “melted and poured.”

In the past, if steel was altered substantially through a process such as cold rolling or coating, where it was processed became its country of origin for trade purposes. Now, with the new system, Commerce will take into consideration where the steel was originally produced in an effort to more readily identify transshipment and circumvention of antidumping or countervailing duty orders.

The U.S. steel industry has been a big supporter of the “melted and poured” concept. U.S. steel execs lobbied hard for it to become part of the USMCA trade agreement with Canada and Mexico in regard to automotive production. USMCA requires 70 percent of each vehicle’s steel and aluminum to originate in North America.

Big River Steel has reportedly encountered additional issues with the galvanizing line at its mill in Osceola, Ark., which was damaged by an electrical failure on Aug. 30. Repairs will be completed and the line will be back up and running between Sept. 17-23, according to press reports.

This is the last week for registered attendees to access the recorded sessions from the SMU Virtual Steel Summit. The conference platform will no longer be live and accessible after this Friday.

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

Tim Triplett, Executive Editor

Latest in Final Thoughts

Final thoughts

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.

Final thoughts

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?