Final Thoughts
Final Thoughts
Written by John Packard
August 8, 2021
We are seeing the early signs of a market where flat rolled steel prices are either peaking or about to top out. Last week, I spoke about service center spot prices into their end customers. I mentioned that both the manufacturing companies, and the service centers themselves, were beginning to report spot prices as being stable or slightly lower than what was being offered two weeks before. Many steel distributors continue to raise prices based on our survey results from last week, but there are signs some companies are already making adjustments. In my Final Thoughts published last Thursday, I spoke about growing inventories that were most likely the culprit if a service center was inclined to keep prices the same (or lower prices).
On Friday, SMU provided our service center data providers a “flash” report with the preliminary results from the first five days of data collection regarding distributor inventories and shipments. The results were quite stunning in that we are reporting the third month of inventories increasing as steel mills catch up on late shipments and foreign steel orders arrive. Our full report will be published at the end of this week for data providers, and over the weekend for our Premium members. If you would like to upgrade your account from Executive to Premium, please reach out to Paige@SteelMarketUpdate.com
I quoted hot rolled prices being offered out of Turkey at around $1,500 per ton, well below the current HRC average of $1,890 per ton published last week by SMU.
Now is the time to carefully watch lead times and the position each domestic steel mill takes on each and every product.
Steel Market Update is not calling for lower prices as our Price Momentum Indicator is still pointing toward higher prices over the next 30 days. However, we are seeing the early cracks, and this is coming prior to any new HRC production out of SDI Sinton or North Star BlueScope.
I want to take a moment to remind everyone, SMU will conduct one of our Community Chat Webinars this week. Our Steel Summit Conference is two weeks away and we know there are many questions surrounding the agenda, hybrid vs. live, our platform, protocols at the event, and much more. We will address those issues in our free webinar at 11 a.m. ET on Wednesday. You can register for the event by clicking here.
We are looking forward to going back to a live conference at the Georgia International Convention Center. We anticipate a safe conference if our attendees follow the protocols that I have been referencing for the past couple of weeks (masks will be required in the venue). Of course, those vaccinated against COVID-19 are best prepared to attend this event. We are offering a hybrid option. You can learn more by clicking here or reaching out to us at conferences@crugroup.com
Our next Steel 101: Introduction to Steel Making & Market Fundamentals workshop will be done virtually on Oct. 5 & 6, 2021. You can find more information about the workshop program, instructors, costs, and how to register by clicking here.
As always, your business is truly appreciated by all of us here at Steel Market Update.
John Packard, President & CEO, John@SteelMarketUpdate.com
John Packard
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