Final Thoughts
Final Thoughts
Written by John Packard
January 29, 2018
The steel community was probably disappointed this evening when President Trump failed to mention anything about the Section 232 investigation that has been hanging over the heads of the industry for one year. We will all need to wait to see if the president will do anything on the subject of steel and aluminum imports. In the meantime, January imports are trending toward 2.9 million tons – a spike in imports at a time when a reduction was anticipated. However, most of the flat rolled products are lower than year-ago levels and the 12-month averages. The one product that sticks out like a sore thumb is OCTG (oil country tubular goods). As the energy sector improves, OCTG imports spike. So, we did not get an answer this evening and we will have to wait for another week, month or longer until the final announcement is made.
I tried to provide more clarity to the various price indices by reporting on the offers being received out of the domestic steel mills. Our sources were asked to provide not only their transaction prices, but to also provide what they were getting out of their domestic sources for new spot offers this week. In many cases, we were seeing price offers rising by $20 to $50 per ton, depending on product and supplier.
The strongest product is hot rolled right now. There does appear to be some tonnage available on cold rolled and coated. One mill told us this afternoon that they were still having to “fight the good fight vs. imports from Vietnam and Taiwan.” They felt that the coated product they sell would “…likely bounce at its own pace in the coming days. $42 still easily accessible out there.”
Galvanized buyers, keep your eyes on zinc, which is at a 10-year high trading as high as $1.63 per pound this week on the LME (prior to the fees added by dealers when delivering zinc to the steel mills). Zinc was trading in the $1.40-$1.45 per pound range when the mills announced the new extras now being collected from all mills but U.S. Steel (their website still shows extras dated 4/1/2017 as being in effect).
Steel Market Update will be moving away from U.S. Steel as the provider of extras for our Price Estimator on our website. We will move over to Nucor extras, which is a better indicator of the spot market than U.S. Steel. I will advise once we have been able to make the full change on our website.
As always, your business is truly appreciated by all of us here at Steel Market Update.
John Packard, Publisher
John Packard
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