Steel market chatter this week

Thank you to everyone who shared your time and insights!

And if you don’t participate in our survey but would like to, please contact my colleague David Schollaert at david@steelmarketupdate.com.

Steel prices are moving lower. How do you expect prices to trend over the next three months, and why?

“Down for the next 30 days.”

“Down a bit more then flattening out. $800 per short ton (st) is a floor in my opinion.”

“Continue down – too much inventory in a slowing economy and cheap imports.”

“Likely drop over the next few weeks, and then it will flatten out.”

“Lower because everyone is talking them down – it’s self-fulfilling.”

“Lower because it’s an election year, and historically there is a pause in the steel industry during an election year.”

“It will move lower due to weak demand and good offshore inventories.”

“Prices will bottom out by May/June.”

“Down, down, down. I was always told coming up in this business that it is ‘feast or famine.’ That has definitely become the reality in the last five years.”

“Continuing lower until May, from import pressure on the one hand and scrap on the other.”

“Down into Q2 before a potential correction.”

“I think we will reach bottom shortly, then the mills will pull up. But, unfortunately, prices will be under pressure again come the summer slowdown.”

“We will hit bottom in Q1.”

“Prices will continue to move down through March. The mills will start to push back a bit harder come April/May.”

Is demand improving, declining, or stable – and why?

“Declining. High interest rates are slowing down the economy.”

“Demand is stable, which is great to report. I keep hearing automotive is soft, though, which is bad for everyone.”

“Demand is stable. I expect contract buyers to pull back some this month but to increase as contract prices ease over the next two months. Spot buying should also return.”

“February is slow.”

“We’re stable across the board.”

Are imports more attractive vs. domestic material? Why or why not?

“No. Domestic price is falling.”

“Not now. Because US pricing is dropping fast and because of the lead times.”

“Less attractive due to price, lead-time, and quality concerns.”

“Imports are always priced better than domestic.”

“Yes, due to gap of pricing between domestic and offshore.”

“Imports for specialty products are competitive. But the lead-time risk is large given future price trends.”

“Import pricing is still attractive, albeit less so than a few months ago. Lead time remains the real hurdle.”

“Yes, but getting close to a breakeven in risk.”

“Yes and no. Yes on current price spread. But no due to lead time and falling domestic market.”

“The prices are attractive, but the lead times are not favorable.”

What’s something that’s going on in the market that nobody is talking about? 

“Supporting scholarships for truck drivers.”

“How Section 232 has completely changed the US market, giving mills power to periodically starve the market and raise prices hundreds of dollars above the actual value of steel established on the world market.”

“Covid and other illnesses keeping people home and production down.”

“Who is going to buy Evraz North America?”

“We’ve seen more chatter on SSC M&A activity, which is good. I still am curious about AHMSA, though.”

“Outages that are planned for second quarter.”

“The lack of new import orders being placed for late Q2.”