Final Thoughts
Final Thoughts
Written by John Packard
August 22, 2016
As I wander around the industry talking to buyers and sellers of steel I am always asking and listening for the signs of change. These are “warnings” to my ears and I heard one earlier today that needs to be pursued further and I think we will have the opportunity to do so at our conference next week. A large service center who is a supplier to the automotive industry was telling me this afternoon that their company has seen an abrupt slowdown in releases from their automotive customers. I was told, “After July shutdowns… the first couple of weeks of August the releases just aren’t there.” I asked if the automotive rolling schedule (normally 12 weeks of orders) had changed and we were told “no, the rolling schedule is still the same.” Inventories of unsold automobiles (and trucks) are high and their company was definitely concerned about the flow of incoming steel not matching the releases…
A service center executive told me this morning, “Hot rolled is hitting the skids, mostly for volume, not necessarily for the little guy.” He went on to say, “I don’t see much hope for this market. It will continue to go down.”
I also spoke with one of our speakers who will address both steel and other metals and where they see the products based on what the “charts” have to say (hedge, don’t hedge, etc.). She was bullish on metals like nickle and aluminum and bearish on steel. To be fair she intends to look at the steel market closely because the bearish sentiment may be over-cooked compared to what is happening with other commodities.
Chinese prices have been rising. One of the conversations I had today was about what converters are paying for Chinese substrate and that prices are moving higher in Asia. I know this topic will come up at our conference.
Demand, mixed messages today. Construction is looking good. Auto – something to watch. Energy – coming back but from a very deep hole.
I am looking forward to our Steel Summit Conference. I think the timing is perfect. I think we have great speakers for the topics that need to be discussed – both in steel as well as a couple of management topics – and we have a fantastic audience.
I leave for Georgia in the morning and I hope to see many of you in Atlanta in 5 days time.
As always your business is truly appreciated by all of us here at Steel Market Update.
John Packard, Publisher
John Packard
Read more from John PackardLatest in Final Thoughts
Final Thoughts
Some of you have told me that the current market feels about as crazy as early 2021 when demand snapped back after the initial outbreak of the Covid-19 pandemic. Others have said it might be more like late February/early March 2022, when Russia launched a full-scale invasion of Ukraine – and, in the process, caused […]
Final Thoughts
To say we’ve entered a “Brave New World” since Jan. 20 might be an exaggeration, but we’ve definitely entered a different one.
Final Thoughts
I think it’s fair to say that the last few weeks – and last week especially – have been among the most intense for any of us covering steel (or aluminum).
Final Thoughts
A look at how SMU survey respondents are reacting to President Trump's recent actions on tariffs.
Final Thoughts
A lot of the changes basically entail rolling back what I’ll call, for fun, Section 232 Lite. S232 Lite resulted from watering down what I’ll call OG S232 – the one first imposed in March 2018 - with exemptions and exclusions over the years. Now, OG Section 232, is back with its across-the-board 25% tariffs against everyone.