Final Thoughts

It should be expected that some business that moved away from Canada and Mexico due to the tariffs–but better suited for those countries to be the source for the material due to location, quality or other factors–would ultimately return. This could add supply to the U.S. market.

More likely the first impact is going to be that steel buyers expect flat rolled and plate prices to move lower from here. End users may sit on their hands for a bit longer waiting for the Mexican and Canadian markets to react. And don’t forget there was a change in the Turkish tariff, which went from 50 percent to 25 percent. This will take a few weeks to totally shake out.

The SMU Price Momentum Indicator will continue to point toward lower spot base prices on hot rolled, cold rolled, coated and plate over the next 30 days.

I spoke with a Turkish trader over the weekend to see what I could learn regarding their plans and offers. Nothing firm has been offered yet. I was told Europe hot rolled export prices last week were $480 per metric ton, FOB this past week. This was the equivalent of $620 per net ton into the U.S. for August shipment. The trader told me with U.S. offers at “29.00/cwt and even lower,” this would make trades difficult. This trader also told me Turkish scrap prices were “getting high,” which impacts their ability to be competitive. We should learn more from our Turkish sources over the next week.

On Saturday, I attended the commencement at Hamline University in St. Paul, Minn., where I went to college and now sit on their Board of Trustees. The commencement speaker was Justice Alan Paige. You may remember him from his “fearsome foursome” days with the Minnesota Vikings in the early-to-mid 1970s.  Justice Paige sat on the Minnesota Supreme Court for 23 years. I was very impressed with his talk.

Justice Paige talked about character and the importance of recognizing and appreciating the truth. The law taught him that there is indeed a clear truth, and democracy depends on those ferreting it out at all levels.

On my travels back to Florida, I managed to listen to Warren Buffet of Berkshire Hathaway in a talk he was giving to another group of young people. He was asked, what does your company look for when hiring someone? He told the group: integrity, intelligence and work ethic. Of the three, he said, integrity was the most important. “After all, would you really want to have someone with high intelligence and work ethic, but no integrity in your business?”

This is yet another busy week for me as I will be in Atlanta on Tuesday through Thursday. I will be in the office on Monday. With Memorial Day Weekend coming up this weekend, we will not publish on Sunday, May 26.

We will begin our next Flat Rolled and Plate Steel Market Trends Analysis at 8 a.m. ET tomorrow. If you receive an invitation to participate, please take a few minutes to answer the question at the end of the email you will receive. This will then take you to the rest of the questionnaire. Thank you in advance for working with us to help us better understand the markets.

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