Editor’s note: The following report on China was contributed by the CRU Group. A power shortage is causing steel production reduction in China’s Hebei province, while in Shandong provincial authorities have ordered a new round of capacity cutbacks across the steel, aluminum and coal sectors. To ensure power for residential use, leading electricity supplier, the […]
Most steel buyers are keeping inventory levels steady or even lower believing that, with steel prices so high, the risk is to the downside for the rest of this year. As one steel executive commented: “We are running inventories lean based on the elevated cost and our opinion that there is a greater chance for […]
Many steel buyers, and investors in steel futures, are betting that steel prices will follow the typical seasonal pattern and decline in the last few months of the year, even with the Trump tariffs boosting the market. While that may prove true for flat roll, it will most likely not be the case for steel […]
The ferrous scrap market is showing small signs of weakness looking ahead to August, report Steel Market Update sources, who say prices on obsolete grades such as shredded and heavy melt are likely to decline anywhere from $5 to $20 per ton next month, while pricing of busheling and bundles will remain unchanged. Demand for […]
Steel Dynamics reported net sales of $3.1 billion and net income of $362 million for the second quarter of 2018, more than doubling its year-over-year income. First-quarter 2018 net sales totaled $2.6 billion with net income of $228 million. “Our second-quarter 2018 income from operations increased 55 percent sequentially to a record $502 million, and […]
The Associated General Contractors of America are supportive of long-term legislation proposed by the chairman of the House Transportation and Infrastructure Committee to address the nation’s aging infrastructure problem. The draft proposal includes a user-fee approach to fund infrastructure repair. AGC CEO Stephen Sandherr said the association is prepared to work with the chairman, leadership […]
The industries that move the nations’ freight are scrambling to find ways to mitigate risks from U.S.-imposed tariffs and foreign-imposed retaliatory tariffs that will impact supply lines and trade flow. Volatility seems to be the new normal as industries face uncertainty over international trade conflicts. Ports Prepare for Tariff Disruptions The Trump administration’s addition of […]
Steel buyers are divided on whether prices have peaked, but most would agree that if they do move higher, any increase will be modest. Steel Market Update canvassed sources this week. Said one executive, expressing a common view: “I don’t see prices rising. I feel we are at the top.” Others anticipate a modest uptick […]
Steel executives canvassed by Steel Market Update this week reported that demand remains strong, though they are less confident about conditions later in the year. Many expressed concern about the tariffs and trade issues unfolding in Washington, difficulty with trucking and logistics, and the impact of high steel prices on their customers. Following are some […]
Construction spending reached a record level of $1.309 trillion in May as monthly increases in residential and public investment outweighed a decline in private nonresidential outlays, according to an analysis of new government data by the Associated General Contractors of America. Association officials warned, however, that continued labor shortages and rising materials costs threaten future […]
U.S. scrap exports expanded by 31 percent in the first four months of 2018, while total global scrap trade has been trending up since Q1 2016. Steel Market Update performs this analysis quarterly to help readers understand the gyrations of the domestic scrap market and where the U.S. stands as a global player. This data […]
What are the issues affecting price negotiations? What is the direction of spot pricing? Steel Market Update canvassed the market this week to gather executives’ perspectives. Following are some insightful comments: Q: What are you seeing as the biggest issue affecting price negotiations with your suppliers? A: “Supply is constrained. That is the biggest issue.” A: […]
The trade war with China has begun. On June 15, the United States announced it will place 25 percent tariffs on $50 billion of Chinese goods. The announcement was swiftly followed by one from China imposing retaliatory tariffs in an equivalent amount. In a statement on Friday, President Trump said: “My great friendship with President […]
I am finally home long enough to gather my thoughts and hopefully get back to providing some insights into the flat rolled, plate and scrap markets from my perspective. There is obviously a lot of uncertainty connected to the Section 232 tariffs in both steel and aluminum. The Trump administration appears to have an intense […]
Service centers held essentially the same number of months of supply of flat rolled steel inventories at the end of April as they did as of the end of March 2018. SMU Service Center Months of Supply Index for flat rolled (sheet) steel is 2.7 months based on responses from 95 percent of the steel […]
Carbon steel prices have escalated at a lower rate than aluminum, but higher than plastic and wood. Truck transportation prices are rising faster than rail, according to the latest data from the Bureau of Labor Statistics. Last week, the BLS released its series of producer price indexes (PPIs) for more than 10,000 goods and materials […]
Ferrous scrap prices have declined a bit in May, reported Steel Market Update sources, due to weakness in the export market and warmer spring weather that aided scrap collection and boosted supplies. Looking ahead to June, sources expect further change, but they disagree on the degree and direction. In the Ohio Valley, prices declined, but […]
Since November 2008 Steel Market Update has been measuring how buyers and sellers of flat rolled steel felt about their company’s ability to be successful in both the existing (current) as well as future (3-6 months into the future) market conditions. The result is our nationally known SMU Steel Buyers Sentiment Index which we believe […]
Shortage of truck availability and drivers is putting the squeeze on freight shipments in May. Anecdotal comments in steel earnings reports indicate mills and distribution centers are having difficulty finding trucks to move their products and higher freight costs are increasing operating costs. Steel Market Update looks at some of the current issues facing freight […]
Big River Steel has signed an option agreement with the Board of Commissioners of the Port of Brownsville to bring a $1.6 billion steel mill and distribution facility to south Texas. The agreement gives Big River Steel the option to lease 800 acres between the Brownsville Ship Channel and State Highway 48. The facility will […]
As Steel Market Update analyzed the inventory data received from flat rolled steel distributors, we found the number of months of supply that steel service centers are carrying was lower at the end of March than what we reported at the end of February. With 96 percent of our data providers reporting, the number of […]
Steel Market Update’s sources report that ferrous scrap prices have increased by $5 to $15 per gross ton in April, depending on the type and region. Some predict scrap prices are likely to decline in May. Strong domestic demand is the key driver of rising scrap prices, said one dealer in the North. “With few […]
A lot is going on in shipping markets as uncertainty regarding the U.S. trade situation takes hold. Tariffs are expected to affect import volumes at coastal and inland ports. Truck availability continues to be an issue with the flatbed load-to-truck ratio soaring past 100 last week and prices on the increase. Barges are frustrated by […]
First, ferrous scrap prices are rising for delivery during the month of April. However, our sources are telling us that the increases are not at the $20-$30 per gross ton suggested a few days ago. The mills are playing hardball and the sense is that prices will drop in May, so dealers are taking what […]
The Georgia Ports Authority broke ground on the $126.7 million Mason Mega Rail Terminal on Monday. The new terminal will increase the Port of Savannah’s rail lift capacity to 1 million containers per year. “Today is a great day for Georgia and the nation,” said Georgia Gov. Nathan Deal. “Not only will this new intermodal […]
Pointing to improving market conditions and favorable pricing trends, Canada’s Stelco forecasts Q1 earnings of $60-70 million and Q2 earnings of $120-150 million. The integrated steel producer expects first-quarter 2018 shipments to be 3-5 percent higher than fourth-quarter 2017. In late Q1 2018, the company expanded its distribution capabilities by adding 200 rail cars to […]
Ferrous scrap prices are expected to rise $20 to $30 per gross ton in April, and possibly more, according to Steel Market Update sources. All grades are expected to see increases, and with relative parity across the country. One dealer told SMU there is pressure on obsolete grades as the long winter has impeded the […]
The competitive position of steel and steel products has improved in the last few months, according to Bureau of Labor Statistics (BLS) data. In the past, we have reported the producer price indexes of steel and some competing products on a quarterly basis. This month, we have revamped and expanded our report to provide subscribers […]
Shipping in the freight market was significantly better in the first quarter than it was during the same period last year, said MID-SHIP Group in its March 8 report. New ships are on order that will not hit the market until the end of 2109 or 2020 and for now the freight market remains bullish. […]
Ferrous scrap prices have risen at a greater rate than expected by sources quoted in Steel Market Update last month. Scrap guru Mike Marley of World Steel Exchange Marketing reports that recent price increases have varied by region to region, and even within a few regions. In the North, shredded and cut grades are up […]