Cliffs Natural Resources is a leading producer and supplier of iron ore pellets to the Great Lakes regions. CEO Lourenco Goncalves spoke at length about the iron ore market during the Cliffs earnings conference call this week. “Our U.S. Iron Ore pellets are often incorrectly compared with seaborne iron ore fines. Fines require additional processing […]
I adjusted the SMU Price Momentum Indicator from Lower to Neutral in recognition of the attempt by the domestic steel mills to reverse the price trend and move prices higher. A Neutral indicator means prices could move in either direction (or remain stable) over the next 30 days. I understand two mills have made very […]
This is good. There is a debate going on within the industry regarding the need for a price increase and whether the customers (tail) are wagging the dog (mill). One buyers ask SMU, “Knowing their history of lacking price discipline…taking advantage of their fear and uncertainty of not filling mill and talking the market down […]
Reliance Steel & Aluminum Co reported record sales for third quarter of $2.71 billion on shipments of 1.5 million tons. Not only did the company have good results to report, the Reliance executives had good commentary to offer in their third quarter conference call. Reliance noted that their purchase of imported steel has increased from […]
On Thursday of this past week Nucor announced their earnings and conducted their quarterly earnings conference call with analysts. SMU has highlighted a number of subjects touched on during the conference call. The following information (minus the headers) was taken directly from The Street transcript of the call: Potential for Light Flat Rolled Trade Cases […]
Steel Market Update is beginning to see weakness in demand based on the results of our last two flat rolled steel market surveys. The manufacturing companies are the first to report the weakness and service centers are beginning to follow. Our Premium (and free trial) level members can review the Power Point presentation that we […]
Nucor beat guidance forecasts with earnings of $245 million for the third quarter of 2014, up from $147 million in both Q2 2013 and Q3 2013. Consolidated net sales increased 8 percent to $5.70 billion. Strong third quarter earnings were attributed to improved performance in sheet steel, structural, bar, and plate steel that was partially […]
The steel market seems fragile right now said members on this morning’s monthly steel conference call hosted by the Heating, Air conditioning, Refrigeration Distributors International (HARDI). Pricing is beginning to slip as demand remains steady was the consensus of most callers. A HVAC wholesaler noted the mills are “negotiating more readily than they were at […]
Steel Market Update received the following from a member of the financial community regarding consolidation and its impact on the steel industry both short and long term. I am reproducing the email in its entirety and you are welcome to add your comments: “Hope you are well. Wanted to touch base on your recent steel […]
We have selected the hotel we will be using for our next Steel 101 workshop (January 20-21, 2014). The hotel will be the Charleston Harbor Resort & Marina and we have a great off-season rate. We should have more details on the hotel and have the reservations system set up by the middle of this […]
After the recent sell off of HRC futures, it appears the market has reached a critical support level with Cal 15 trading at $620. Near months aren’t much higher with Nov14 trading around $623 and Dec14 at $621. The selloff came as concerns over the global economy came to light in recent weeks. The International […]
Besides working on flat rolled steel pricing for most of the week, I have also been interviewing companies by email and over the phone to learn more about demand and how demand is holding up as we get deeper into 4th Quarter 2014. This becomes an even more important topic when considering rising inventories at […]
SMU was reading a blog post put up by Metal Miner this morning regarding the consolidation of the steel industry. The main premise of the guest article from James May of Steel-Insight out of Canada, was 81 percent of the hot rolled production in the United States and Canada is controlled by four companies: ArcelorMittal, […]
Steel Market Update recently published an article about the beginning of the 2015 non-automotive flat rolled steel price negotiations between end users, service centers and the domestic steel mills. We continue to gather information regarding the status and tone of the negotiations and we are learning that 2015 will be much different than what transpired […]
Big River Steel has asked the Arkansas court to dismiss a federal lawsuit by Nucor Corp aimed at preventing construction of the new mill. In documents filed Friday, Big River steel called the suit by Nucor “a scorched earth campaign.” Nucor claims that Big River Steel’s mill will violate the Clean Air Act, an allegation […]
We are in a very interesting market as many factors are influencing domestic scrap and steel prices. We discuss currency issues in tonight’s issue as the appreciating dollar means less competitive exports out of the United States but it also makes foreign steel imports more attractive to buyers. We have falling iron ore (which is […]
Nucor Corp. has completed the acquisition of Gallatin Steel Company in Ghent, Ky., for a purchase price of approximately $770 million. Gallatin’s strategic location on the on the Ohio River will expand Nucor’s access to the Midwest flat-rolled steel market and strengthen its position in the pipe and tube sector. Gallatin Steel has an annual […]
2015 annual contract negotiations have begun, according to both manufacturers and service center steel buyers. The next month or two should be quite interesting as the process continues. Early reports are suggesting that the domestic steel mills may be more “flexible” in their flat rolled steel price negotiations than they were at this point in […]
On Tuesday (today) Steel Market Update (SMU) adjusted our Price Momentum Indicator from Neutral to Lower. I explain our reasoning in the first article above regarding our price indices. I will do a more detailed explanation as to why we are making a change at this point in time in the coming days. Today Steel […]
Our Price Momentum Indicator has been stuck in “Neutral” since the last day of June 2014. We are now entering our 4th month and hot rolled steel prices have barely budged from the center line (OK, there have been some mild gyrations but no clear cut path up or down during the past three months). […]
Nucor Corporation has received approval from the Federal Trade Commission for the $770 million acquisition of Gallatin Steel. The Company expects to close the deal in approximately ten days. “We are excited to be able to begin the process of integrating Gallatin Steel and our new teammates into the Nucor family,” said John Ferriola, Chairman, […]
One item I keep hearing from the service centers I speak with – and it doesn’t matter what the product is – hot rolled, galvanized, Galvalume I am hearing the same thing. Business is good, in some cases excellent, but margins are being squeezed. Competition appears to be willing to move off inventory for whatever […]
On Wednesday, Steel Market Update (SMU) participated in a monthly steel conference call hosted by the Heating, Air-conditioning , Refrigeration Distributors International (HARDI). HARDI wholesalers supply galvanized sheet and coils to the mechanical contractors involved in residential, multi-family and commercial construction segments of the construction industry. Consolidation was the first topic of discussion with AK Steel […]
We anticipate closing registration for the Ft. Wayne, Indiana Steel 101 workshop on Friday of this week. We have (once again) an excellent group of companies and people registered to attend with a record number of women attending (11). If you would like to learn more about our Introduction to Steelmaking & Market Fundamentals workshop […]
Steel Market Update attended the groundbreaking ceremony for Big River Steel in Osceola, Arkansas which was held on Monday, September 22nd. According to Big River Steel Chairman and CEO John Correnti (and the sign at the entrance to the work site), the mill will be making steel in 550 days. A groundbreaking ceremony is much […]
Consolidation may not be over yet. We saw a report this evening out of Minnesota about how Essar Steel Minnesota has failed to secure financing to complete the $1.8 billion taconite pellet facility. The company’s India parent company was so over-leveraged it was put on the top ten watch list by Credit Suisse one year […]
For those who are keeping track I will be in Arkansas tomorrow for the Big River Steel groundbreaking. It will be interesting to see for myself what all the fuss is about… More about the groundbreaking (and maybe some of the fuss) in Tuesday evening’s issue of SMU. We have also been working on a […]
Steel Market Update (SMU) conducted our mid-September flat rolled steel market analysis this week. We invited slightly more than 600 companies to participate in the latest survey which analyzes various trends which affect the flat rolled steel market. One set of questions had to do with the consolidation of the steel mills as SDI and […]
Nucor is expecting higher profitability for its sheet steel, structural, bar and plate operations for third quarter. In their quarterly guidance, Nucor noted that manufactured goods, including energy and automotive, are their strongest markets. The high level of imports continues to pressure prices downward. Growth in the residential market has benefited the fabricated construction products […]
It will be interesting to see how AK Steel and Steel Dynamics (SDI) interact with the newly purchased Dearborn and Columbus steel mills. One SDI customer told us today that the mill tends to be very deliberate in their decision making process and they did not expect radical changes for a number of weeks if […]