Final Thoughts

Most of our readers think Trump will win. (Full disclosure: We’re probably not the most representative cross section of America.) We’ll release final poll results on Friday along with our steel market survey.

Here is where preliminary results stand now. Approximately 58% of SMU survey respondents think Donald Trump will be the next president while 42% think Vice President Kamala Harris will win the Oval Office. (We also had some undecideds.)

Fun fact: That’s a little bit of a shift toward Harris compared to late August, when we asked a similar question at Steel Summit. Then, 63% of attendees picked Trump and 37% picked Harris.

Here is what some of our survey respondents had to say this time around. Trigger warning: Some of it is a little dark, which probably reflects the tenor of US political discourse.

Trump will win

“I’m being optimistic, but I’m fearful whoever loses will fight to the bitter end with recounts and litigation.”

“Lesser of two evils. Most people vote with their wallets. And I haven’t talked to many folks who believe our economy/personal balance sheet is in a better spot today than during Trump’s first administration.”

“The platform is better for the US.”

“Gut feeling.”

“Praying for a red wave.”

“Too close to call.”

“Closet Trump fans will come out to vote.”

“Because the country knows what they get with each candidate. And when they give it serious thought, there’s no decision to be made.”

“Due to pocketbook election issues.”

“People looking for a better economy.”

Harris will win

“If not Kamala, then our country is in for a difficult future.”

“People are stupid and can’t do math.”

“Trump is too unhinged and is seen as a dangerous option by a majority of voters.”

“Stability.”

“Regardless of who wins, I hope we don’t have a prolonged and violent period of indecision and disagreement over the results. We need to unify as best as we can.”

“As a Conservative, even I recognize former President Trump is a psychopath.”

Undecided

“I’ll tell you tomorrow :)”

“Too close to call.”

What does it mean for steel prices?

I’m not sure that I can add anything to what’s been said already when it comes to policy writ large. We’ve run some good election-related coverage from CRU, our parent company. You can find those articles here and here.

As I noted in a prior Final Thoughts, we saw a “Trump Bump” in hot-rolled (HR) coil prices in 2016. Prices went from $480 per short ton (st) shortly before Election Day to $630/st just after Inauguration Day in late January 2017 – a gain of 31%.

But it doesn’t appear that a post-election move upward in prices is exclusive to Trump. I went back through our archives, and it looks like we had what I’ll call a Biden Bounce in 2020-21. Namely, HR prices stood at $700/st on Nov. 3, 2020. By inauguration day, they were at $1,200/st – a gain of $500/st – or 71%.

A lot of that had to do with the unexpected snapback in demand following the pandemic. So what about the 2012 election? It had no appreciable impact on steel prices – or at least not by the standards of the mega-cycles we’ve seen in recent years. SMU’s HR price stood at $600/st on Election Day on Nov. 6, 2012. On Inauguration Day on Jan. 21, 2013, HR was at $620/st – a gain of 3%.

Our data series starts in 2009. So I can’t offer a 2008-09 comparison. But I can say that at least as long as SMU has been formally tracking HR prices, we’ve never seen price decreases between Election Day and Inauguration Day. And in some years we’ve seen some big gains.

Seasonality vs policy

Maybe it has as much to do with seasonality as with policy. Let’s use round numbers here. I know some of you are trying to negotiate sizable buys for approximately $600/st. (Maybe a higher base price if there are waivers for grades and freight extras. Maybe a little less if there are not.)

Let’s say orders are placed around those numbers and lead times start to stretch out as a result. That could put mills in a good position to announce price hikes around Thanksgiving and into December – something we saw in 2022, for example.

And some of you tell me that while you’re seeing low prices – in the low/mid-$600s/st – you’re also seeing more volume. Perhaps because steel consumers think that there will eventually be an increase that will stick, and they’re trying to get out ahead of it.

Let’s assume that inventories continue to move lower. And let’s assume that there is an uptick in business once the uncertainty of the election is past – even if it’s just a round of restocking. I could see a case for higher steel prices between that and seasonal factors.

What does six months or 12 months from now look like? I have some real questions about that, especially when it comes to Trump and his proposed blanket tariffs and deportations. That’s more of a jump into the unknown than Section 232 was.

That said, steel will probably see continued protections no matter who wins. Perhaps Trump acts more quickly and impulsively whereas Harris would act more incrementally. I haven’t heard any battle cries about repealing Section 232.

Do you have any smart ideas about what things will look like next spring or in November 2025? Let me know, and maybe we can get you signed up for an upcoming Community Chat.

SMU Community Chat

Speaking of which, you won’t want to miss our next Community Chat with Wolfe Research Managing Director Timna Tanners. The webinar will be on Wednesday, Nov. 13, at 11 am ET. We’ll be talking about the election, new capacity, trade policy, and more. You can sign up here.