Final Thoughts

Hard decisions such as canceling the endless casting and cogeneration upgrade at its Mon Valley works after already investing $170 million on the project. Hard decisions like permanently closing three coke lines at its Clairton Coke Works by 2023. The Mon Valley announcements were “informed by our expanded understanding of our steelmaking future and an accelerated approach to reducing our carbon and capital intensity,” said Burritt.

The steel industry has a dismal record on the environmental front stretching back more than a century. Even today, steelmaking accounts for 8% of total global CO2 emissions, though most of that takes place outside North America. I’m optimistic that we have reached a tipping point where government and industry finally take the threat from climate change seriously. But the cynical side of me has to wonder if the steel companies are really sincere or are just pandering to the current green zeitgeist and the current administration. I hope they aren’t just giving us a cookie and a pat on the head knowing the payoff is not due for 30 years when most of us will be retired or dead. Our grandchildren’s future depends on it.

Transportation Bottleneck

The economy and steel demand are booming, but could be doing even better if it weren’t for logistical constraints all across the country. More than 85% of those responding to Steel Market Update’s survey his week reported difficulty securing the trucks, trains and ships needed to move their steel. “Truck availability is the worst I’ve experienced in more than 30 years in the steel industry,” said one service center executive. “Without a doubt, the freight world is in a tough spot. Just try booking a truckload from the Midwest to the West Coast. It ain’t happening!” said another steel buyer.

Not Enough Steel 

Little sign yet that the tight steel supplies are loosening. Sixty percent of survey respondents said they are still unable to purchase enough steel to satisfy their customers. “It’s more and more difficult to get tons with the mill outages, extended lead times and shipping issues. It’s almost a perfect storm of what can go wrong, will go wrong,” said one exec. “Our supply and demand are currently at equilibrium,” said another, “but we expect second-half demand from our customers to outstrip mill capacity growth.”

SMU Events

For those of you who are looking forward to this year’s in-person SMU Steel Summit, plan to arrive early into Atlanta as the CME “Futures Showcase” workshop that kicks off the conference is scheduled for 10 a.m. ET on Monday, Aug. 23. You can learn more about the conference, agenda, speakers, costs to attend and how to register by going to: https://www.events.crugroup.com/smusteelsummit/home or by clicking here.

As always, your business is truly appreciated by all of us here at Steel Market Update.

Tim Triplett, Executive Editor