Final Thoughts

The conference and most associated events – including cocktail receptions and our Introduction to Steel Hedging Workshop – will be conducted in the Tampa Marriott Water Street Hotel.

We consider Monday a travel day. We also understand Monday is Valentine’s Day. And so we only have a couple of late afternoon/early evening networking events planned. There is a boat tour of the Port Tampa Bay Harbor, and there is a networking cocktail party that begins at 5:00 PM and runs until 6:30 PM.

Tuesday morning also has a few special events: a golf outing at The Eagles Golf Club, another boat tour of the port, and the conclusion of the two-day Introduction to Steel Hedging Workshop.

At 1:30 PM, we will begin the event with three special programs in the conference center on the second floor of the Marriott Water Street Hotel. That evening there will be another cocktail reception in the hotel.

On Wednesday, we will have a full agenda of speakers and topics germane to those involved in flat rolled, long products or scrap. The conference will wrap-up around 3:30 PM ET.

You can find specific information about our agenda, speakers, costs to attend and how to register at www.tampasteelconference.com.

The subject of what “new normal” steel pricing has come up often recently. It will be on the agenda at the Tampa Steel Conference too. Many assume that benchmark hot-rolled coil prices will stabilize well above the $600-$650 per ton ($30-32.50 per cwt) average we have seen historically. Almost no one thinks HRC prices will reach the $440 per ton we reported in August 2020, the bottom of the last price cycle leading up to the monster run we have seen since.

I was reading a UBS analyst report recently about steel equitiues (aka mill stock prices). It factored in a hot rolled selling price of $800-$900 per ton vs. the current spot price, which SMU last week pegged at average of $1,235 per ton. This is still a very hefty price for hot-rolled coil.

I asked a number of contacts within the industry where they think steel prices will settle. Most of the mills I spoke to think we are just a few weeks away from prices stabilizing and potentially moving higher. They forecast HRC prices remaining above $1,000 per ton. Service centers executives I spoke with were skeptical of a $1,000-per-ton floor. They think that is just a mill theory and instead estimate that HRC prices will bottom anywhere from $800 per ton to as low as $400 per ton – or back to where we began the current cycle.

I was on a call late last week with Bill Spiegel, president of Southwark; Mike Lerman, president of Steel Warehouse, John Farley, chief pperating officer for McNichols, and Bob Elssaser, vice president of procurement for Behlen Manufacturing. Their companies cover a wide range of end user markets and use various steels from plate to ultra-light gauge galvanized. This group will be speaking at the Tampa Steel Conference about end-user demand within the markets they cover, and they will be discussing the various supply chain issues they are dealing with.

I also spoke with Lourenco Goncalves, CEO of Cleveland Cliffs, who had a number of interesting observations that I cannot discuss right now because Cliffs will be releasing quarterly earnings figures later this week. He will be speaking at the Tampa Steel Conference on Wednesday morning. 

It looks like this will be an interesting week for the steel industry.

Enjoy your week, and I look forward to seeing you in Tampa.

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

John Packard