Final Thoughts

Others say it continues to be a story of lackluster demand propped up by limited supply – whether that’s because of low import volumes, Canada being largely out of the US market, or scattered outages.

Then there are the conspiracies. I won’t get into the geopolitical ones. I’m referring to a persistent rumor I hear from some of you that US mills might get a scolding from President Trump if he sees hot band prices go above a grand.

Personally, I’m not so sure about that one. Recent headlines suggest the president has a lot of things on his mind. Few of them have much to do with steel. (But, who knows, that might have changed by the time you read this column.)

I think we can all agree on this: It’s been extremely cold across much of the country.

The plunging mercury has reduced flows of shredded and obsolete grades, and busheling might go along for the ride. I’m not going to predict where scrap will settle in February this early in the month. But let’s just say steel mills generally don’t drop finished steel prices when scrap goes down. And they sure tend to raise prices when scrap goes up.

Also, persistent stretches of extreme weather can sometimes cause production issues – especially if the severe cold dips into the South. Could we see more meaningful outages than we’ve seen to date?

In short, I can see why, even if demand doesn’t get a lot better, prices might continue to grind higher. And, if there were to be a big, unplanned outage, how they might go up more significantly.

What also strikes me is what a relatively calm start to the year it’s been for steel prices, at least so far. I’m used to seeing some shock (tariffs last year, Russia’s invasion of Ukraine in 2022, etc.) send prices suddenly soaring. And then they grind lower for months.

That’s not to say there aren’t some real potential shocks out there.

Trump’s 25% tariff on countries that do business with Iran officially went into effect today. Do 50% Section 232 tariffs trump those? (Pun intended.) Could they stack? It reminds me of the discussions we were having in Q1 of last year about tariffs on Canada and Mexico.

And what about the 10% tariffs on eight European countries that are scheduled to go into effect on Feb. 1 (and to increase to 25% on June 1) if Trump doesn’t get his way on the US buying or otherwise taking control of Greenland?

Let’s just say that’s definitely not a question I expected to write a year ago. Is Arctic security important? Is Greenland part of that conversation? No doubt. Are tariffs and threats always the best way for the US to pursue its interest? I leave that up to you, dear reader.

Whatever your view, these are historic times. Mark Twain once said, “History doesn’t repeat itself, but it often rhymes.”

I’m not going to be looking for any grand historical patterns this week. What I’ll be looking out for is something we saw last year.

Remember Liberation Day? The Q1 steel price rally suddenly unwound in early April of last year as all the uncertainty related to the array of new tariffs sent everyone to the sidelines. After a while, people got used to the higher level of uncertainty. And both the stock market and the steel market resumed their moves upward.

This feels similar. Does the level of geopolitical uncertainty get to the point where it impacts not only the stock market but also the broader steel market? Could we see a repeat of Liberation Day, or will the news cycle move on to something else by the end of the week? I don’t pretend to know what might happen in Davos. Suffice it to say, it’s going to be a newsy week.

SMU and AMU Community Chats

And that means the Community Chats SMU and Aluminum Market Update (AMU) are holding this week will be a lot timelier than I thought they’d be when I put them on the calendar last year.

Jerry Richardson, General Director of CSN LLC, will join SMU for a Community Chat on Wednesday at 11 am ET. We’ll be talking about the outlook for demand as well as trade and tariff matters. We’ll anchor the discussion in the steel trade between the US and Brazil. But I think many of the themes will have broader implications. You can register here.

Also, AMU contributors Greg Wittbecker and Edward Meir will discuss the outlook for 2026, whether Midwest premium might be nearing bubble territory, and why higher LME prices could be justified. Trade and tariffs of course factor into those discussions. So, if you’re interested in aluminum, you’ll want to tune in on Thursday at 11 am ET. You can register for that one here.

In the meantime, thanks to all of you – in the US and abroad, in steel and in aluminum – for your continued support!