Final Thoughts

Cue the music. Cue the clarity. Let the sun shine in! But that hasn’t happened. Much stronger demand hasn’t materialized. Trump 2.0 ain’t bumping, at least not yet. Prices aren’t rocketing up like a SpaceX test launch. We’re still waiting and seeing.

As an aside, have we considered what will be the effect of Tesla chief Elon Musk presiding over the Department of Government Efficiency (DOGE)? What happens when a man who sold flamethrowers to the public tackles government overreach? Will the results be scorching?

The SMU Linton view

But, back to steel. I asked SMU Senior Analyst Brett Linton for a 30,000-foot of our recent survey data. His response:

Steel Buyers Sentiment has become more positive over the past six weeks, recovering from the pre-election lows seen in late October. And the latest Future Sentiment readings are among the highest observed in the last three months.

But steel mill negotiation rates (the percentage of mills willing to negotiate lower prices) remain elevated, according to our latest survey. The current rate is one of the highest recorded this year.

Lead times have shown slight signs of extending in our most recent survey. But they remain just slightly above the multi-month lows recorded in October and November. For most of 2024, lead times have been stuck at historically low levels.

I’ll let the data junkies among you plug this into AI for analysis. With any luck, a pretty chart can be generated for use in a PowerPoint slide. (Editor’s note: We will have just such charts and analysis – from our Steel Market Survey and painstakingly prepared by humans at SMU – available to our premium subscribers on Friday. It’s a good reason to upgrade from executive to premium. If you would like to, please reach out to SMU salesman Luis Corona at luis.corona@crugroup.com.)

The road ahead

I confess I haven’t read Trump’s The Art of the Deal. Perhaps I should. However, from the President-elect’s Truth Social feed, I have made the following observations. One, he likes to capitalize words, sometimes the whole word, in ways that don’t conform to things we learn as children in English class.

This has a striking effect on the reader, and we have chosen to preserve it whenever we republish his posts. Also, regardless of content, if I ever see a whole sentence in ALL CAPS, or even a whole PARAGRAPH… something big is happening. Probably best to seek shelter and/or embrace loved ones.

Second, things so far have a shotgun blast quality to them. Threatening tariffs on China, tariffs on neighbors, 100% tariffs, 25% tariffs, BRICS tariffs, etc. I’m no policy analyst. But tariffs seem set to to play a significant role in Trump 2.0.

Also, we are in the “aim big” phase. We will see if there is a retreat into a more nuanced calibration phase soon.

If Theodore Roosevelt’s diplomacy policy was famously based on “Speak softly and carry a big stick,” Trump, another native New Yorker, seems to hold to a different line. While I’ve never seen it directly articulated, it might be something akin to Watch out, world, I’ve got something to say. Also, I’m carrying a big stick.

So, while the hoped-for clarity hasn’t yet materialized, at least we live in… times. I’m making a pre-New Year’s resolution not to use the word “interesting” here.

Now—in a very incomplete list—if only the war in Ukraine ended, peace blossomed in the Middle East, the longshoremen amicably reached a tentative agreement before Jan. 15, the grid got electrified, EV demand returned, auto woes subsided, sun beamed and wind blew in abundance to supply energy to intrepid crypto miners, and—dare to dream—coal itself became decarbonized… maybe then we could return to normal, whatever that might be. But I’m not going to hold my breath.