Steel Blog

ArcelorMittal Raises Flat Rolled Base Prices

Tuesday, 17 October 2017 23:07

ArcelorMittal USA began advising their customers late this evening of their intention to raise flat rolled steel base prices. In an internal memo sent to the ArcelorMittal commercial team the mill advised, “All new opportunities for hot rolled, cold rolled and coated sheet products that require delivery in the 4th Quarter of 2017 should be specifically inquired for production availability before any formal or verbal acceptance of an order takes place.”

The mill then went on and advised that the following “minimum” base prices on sheet products are to be in effect “immediately”:



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Those who believe unfairly traded steel imports pose a serious threat to America’s security have a high-ranking ally in retired Brigadier General John Adams. In an Oct. 16 op/ed in The Hill, titled “North Korea is Distracting from America’s Steel Import Crisis,” Adams argues that the Section 232 trade case should rate headlines comparable those on North Korea’s nuclear ambitions.

“For months, news outlets have faithfully covered the latest updates on Kim Jong Un and North Korea’s continued nuclear tests. While it is critical for the public to be made aware of these developments, we must not let it distract from the many other ongoing issues impacting national security. The Section 232 probe into the national security impact of steel imports is one such urgent matter that has not received the attention it deserves,” Adams wrote.



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Circumvention Decision Put Off to Oct. 30

Tuesday, 17 October 2017 15:23

The U.S. government has advised the steel industry that it will delay its preliminary determination on the circumvention trade suit against Vietnam until Oct. 30. The suit alleges Vietnam was assisting China to circumvent the U.S. antidumping and countervailing duties assigned to China in 2015/2016. Domestic steelmakers say the U.S. government should no longer recognize "significant transformation," which is when a steel mill takes a coil and rolls it to make another steel product. In the case of Vietnam, they were converting Chinese hot rolled substrate to cold rolled and/or coated steels, or they were coating cold rolled to coated products (galvanized and Galvalume).



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SMU Price Ranges & Indices: Slow Slog South

Tuesday, 17 October 2017 17:45

Flat rolled steel prices continued their slow slog south (prices are moving lower). The pace has not accelerated, but there are questions as to whether some of the mills are cutting "quiet" deals in order to fill their fourth-quarter order book without giving the steel away.

One service center put it to us this way: "If you have index contracts, those prices aren’t that attractive, so my guess is some cheaper pricing must be out there to motivate anyone wanting to buy big volume right now. My guess is in the next two weeks there will be a lot of 'quiet deals' being done on volume to get December books full. For those who have learned that they can live comfortably with 2 months of inventory, even a so-called 'deal' right now isn’t that attractive, considering we could be entering a phase of lower input cost for an extended period."



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The U.S. Department of Commerce (DOC) provided license data through Oct. 17 (today) regarding the amount of foreign steel slated to come into the United States during the month of October. Based on the license data, the trend is for yet another 3 million net ton (or higher) month.

There are some significant changes to the numbers that should be viewed carefully. The trend on semi-finished steels (mostly slabs) is for close to 800,000 net tons. This would be up 200,000 tons compared to the previous month. The three-month moving average (3MMA) is 804,000 net tons, so the data is staying consistent. Oil country tubular goods continue to surge with the trend now for 324,000 net tons, which is within the 3MMA for the product and well above the 12-month moving average. Larger imports of OCTG hurts sales of domestic hot rolled coil.



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Steel shipments by Canadian service centers in September totaled 356,600 net tons, down 8.0 percent from the previous month, and down 3.8 percent from September 2016, reports the Metals Service Center Institute (MSCI). On a daily basis, total shipments were 17,800 tons per day in September (a 20-day month), up from 17,600 tons per day in August (a 22-day month), and up compared to a year ago when they were 17,700 tons per day (a 21-day month). Total steel inventories at the end of the month were 1,163,200 tons, down 1.7 percent from last month, but up 4.2 percent from this time last year.



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MSCI: Flat Roll Shipments Dip in September

Tuesday, 17 October 2017 16:53

September steel shipments by U.S. service centers were essentially unchanged from September 2016. U.S. steel inventories increased on a year-over-year basis for the first time since August 2015, stated the Metals Service Center Institute in its September Metals Activity Report.

U.S. service center shipments of all steel products in September totaled 3.043 million tons, about the same as shipments in September 2016, but down 12.3 percent from August.

Service center inventories at the end of September totaled 7.794 million tons or 2.6 months on hand. That’s a 2.4 percent increase from the 7.613 million tons and 2.5 months on hand the prior year. Tons shipped per day totaled 152,200, up from 145,000 in September 2016.



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Final Thoughts

Monday, 16 October 2017 08:00

As the afternoon turned into evening, I began hearing rumors that a flat rolled price increase would be announced “soon.” I heard from a service center who was texting us from his car (a definite no-no) telling SMU that a yet to be named (by us) mill was moving prices. We are still waiting for the car to safely stop so we can learn more. As the evening wore on I spent time searching for confirmation from more buyers or from the mill itself to make sure we had the correct information. Just before 11 PM I received what I needed to confirm the ArcelorMittal USA price increase. What is written below was done prior to 11 PM...



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Next SMU Steel 101 Workshop Set for Mobile

Tuesday, 17 October 2017 12:31

The next Steel 101 steel training workshop will be held in Mobile, Ala., and will include a tour of the SSAB Mobile minimill. Registration is open, and the workshop currently is almost half full.

“SMU Steel 101 is a great learning tool for anyone working in the steel industry in any position. I wish I had this class 10 years ago.” Joann Pirko, Magic Coil Products (attended Fort Wayne/SDI workshop in October 2017)

Steel Market Update (SMU) was recently asked what differentiates our Steel 101: Introduction to Steel Making & Market Fundamentals workshop from the competition?



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Auto Council Challenges Commerce Report

Tuesday, 17 October 2017 09:20

The American Automotive Policy Council is challenging data that Commerce Secretary Wilbur Ross cited in his bid to raise the NAFTA auto rules of origin.

In a September report, Ross used data from 1995 to 2011 in an effort to "debunk the claim that U.S. content in the form of parts is so high that we shouldn't worry about headline gross-deficit figures." AAPC did its own analysis of the data and identified several "significant problems and inconsistencies:"



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