Steel market chatter this week

Want to share your thoughts? Contact david@steelmarketupdate.com to be included in our market questionnaires.

Steel prices might have bottomed out and may be inflecting up. How do you expect prices to trend over the next three months?

“I think this is a temporary bottom. We are expecting a few ticks upward but then things drifting back lower. Demand is just too soft and now with this recent selloff, folks are spooked by the markets. That is a bad combo.”

“Flat to down – until there is a clearer picture on the horizon, people will be hesitant to buy more than what they need.”

“I think near term we see a gain, but not seeing a runaway market, potential to bounce along the bottom because of weak demand.”

“I feel small increases for the next few months with mills and service centers supporting the price movement up, but the lack of overall demand not backing it, so we won’t see the typical rapid increase after a bottom is hit.”

“Conflicting signals. Prices should trend up but with the recent ‘spooking’ of stock markets across the globe, we may see a rapid decline in demand which will counter that.”

“I think we will see a slow movement upward over the next three months as mills do their best to prepare for quoting contracts.  But until the economy improves or this election plays out, it’s going to be tough.”

“Lower, slowing economy and high interest rates.”

“Near bottom now. May take a small reduction on the inflation news.”

“Slowly rising as inventories work down and we see low levels of imports for the balance of the year.”

“Prices should increase over the next several months due to mill maintenance, potential trade action and restocking at the service center level.”

“Up, futures indicate this trend.”

“Prices will increase as imports decrease.”

“Slightly upward but not drastic.”

Is demand improving, declining or stable?

“Stable – confidence level still not great. We’ll see many more small orders.”

“Stable for the year, but down from prior years and our forecast.”

“Stable – no one is speculative buying.”

“Demand is stable for us, but the bigger the shop or the bigger the service center, the slower they are.”

“Demand is stabilizing due to interest rates starting to be reduced.”

“Demand remains very weak and soft. Future economic situation is uncertain, especially if higher tariffs for imports are applied after the election, taxing consumers and raising inflation risks.”

“Stable to declining – automotive is OK, but pretty much everything else is down and inventories are still destocking.”

“Declining, but not off the cliff.”

“Declining – slowing economy and high interest rates.”

“A few people coming off the sidelines, but most is stable.”

“Improving.”

Is inventory moving faster or slower than this time last year?

“Slower.” – 10 respondents

“Slower than last year.”

“Slower, demand is lower than last year.”

“Slower as demand remains soft.”

“Inventory is starting to move slower, due to people hesitating or being overextended.”

“Inventory remains moving at a good clip, but we continue to run hand-to-mouth by design.”

“Faster.”

Are imports more attractive than domestic material?

“More attractive.”

“Imports are still attractive.”

“Not yet, but soon the balance will return. Value added will be the first to be attractive again, HRC the last.”

“Imports are always less expensive than domestic.”

“More attractive from a price standpoint but not from a delivery standpoint.”

“Lead times are the killer. Of course if the domestics try to raise things too much too fast (which of course they will), imports will be knocking on our door again.”

“Not really due to high logistics cost and domestic mill pricing is the same with much better lead times.”

“No, spread not great enough in the soft domestic market.”

“No, market is too volatile.”

“Imports are not attractive with longer lead times and uncertain trade case risks.”

“They are not enough of an advantage to domestic prices.”

“Depends on the steel.”

“Not attractive due to our customer requirements.”

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

“Are we now seeing the effects of a soft recession catching up to the manufacturing markets?”

“The market is gearing up for another sharp incline. When demand comes back, low production numbers will promote quick increases. This saw tooth model that we have seen the last three years is going to start changing behaviors.”

“The potential strike by the Longshoremen.”

“I feel there is less confidence in where things are headed not just with the steel market but globally than I can remember in a long time – US politics, wars, trade cases, economy… and it’s been a roller coaster ride for the last 4+ years!”

“Will there be more mill producer consolidation in the next year?”

“Outages are coming.”

“Where is all the infrastructure jobs and where is the money?”

“Inflation fears.”

“If import tariffs are applied by a new government after the election how will that affect imports of steel and aluminum to the US?”

“I’ve seen it here a few times, but any real news on AHMSA or Evraz NA would be welcomed. Just rumors out there right now.”

“AHMSA may now formally enter in bankruptcy and liquidation of assets. A major step.”

“Evraz sale and FBI raid.”