SMU Market Chatter

Market Chatter This Week

Written by Becca Moczygemba

On Monday and Tuesday of this week, SMU polled steel buyers on a variety of subjects, including steel prices, demand levels, sheet prices abroad, inventory, and what people are talking about in the market. Rather than summarizing the comments we received, we are sharing some of them in each buyer’s own words.

We want to hear your thoughts, too! Contact to be included in our questionnaires.

When and at what price level do you think steel prices will bottom, and why?

“Prices will level in November. After that, companies start working on Q1.”

“I think they will continue to drop if the Big Three do not settle a contract. Otherwise, pricing will stick around $750-799.”

“Prices have already bottomed out. Demand is okay and inventories are low. Imports are down and as domestics perform maintenance, there are less available products. However, if there is a prolonged automobile strike, it could change things.

“Bottom will be at $550 because of the slowing economy and too much capacity.”

“I feel prices will bottom in October between $650-700/ton, with the assumption that a UAW strike doesn’t last more than a couple weeks.” 

“Given the climate (UAW and 9/14 looming), I think we’ll be in the $600s pretty soon for HRC.”

“$675-700 due to slow demand and supply is still stable.”

“Everything now depends on the auto contract negotiations.”

Is demand improving, declining or stable, and why?

“Demand is steady.

“Declining.  We are losing plate orders to HRC, and demand has slowed down a bit for our customer base.”

“Stable – lower than 2022.”

“Demand for most seems okay, but not necessarily strong in any real sectors.”

“Declining due to high interest rates and construction demands reducing.”

“Demand remains a bit sluggish.”

“Stable to soft, with some smaller pockets of strength.”

Is inventory moving faster or slower than this time last year – and why?

“Moving slower.”

“Inventory is moving better for us, but as a young company, we’ve been able to gain market share.”

“Slower because offshore supply has been received and demand has slowed.”

“Faster as folks carry less inventory and are motivated to move it in fear of further price erosion.”

“Slower – the economy has slowed down from a steel-usage standpoint.”

With US sheet now at a marginal discount to prices abroad, are imports still attractive vs. domestic material? Why or why not?

Not attractive. The risk is too large.”

“Some imports are attractive, some not. Depends on country of origin, too.”

“No, pricing is too close with delivery and timing.”

“Imports are still decent, the scary part is waiting until late Q4 if you think prices are still dropping domestically…which of course they are.”

“Some areas yes, and plate is still elevated in pricing over offshore material. I agree mills are slow and are negotiating good pricing equal to offshore landed cost.”

“Not yet. Still too much uncertainty in our domestic market.”

“No – Domestic steel is too low and readily available.”

What’s something that’s going on in the market that nobody is talking about?

“What are the effects of the 40,000 tons of HRC that USS-UPI will no longer purchase from USS after they shut down.”

“Surplus of material and especially if the UAW hits all three automakers.”

“I don’t feel there is much discussion on the impacts on steel demand headed into an election year.”

“Service center M&A activity? There must be plenty of folks struggling right now.”

“US dollar rising for exports and Canadian imports exchange rate.”

“A lot of outages.”

Becca Moczygemba

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Steel market chatter this week

SMU surveyed our market contacts this week about steel prices, demand, and the overall marketplace. Below are some of the buyers' responses in their own words to help you get a feel for current and future market conditions. Demand is a big topic of discussion currently. Is it steady, falling, or on the upswing with summer construction heating up? As you can see from the answers below, it depends on who you ask. One buyer’s response sums it up pretty well: “I still see the marketplace as soft/stable with some segments busy, while others tread water.”