We received the following email from a large national service center chain: “I read with great interest your “tsunami” article on the different types of steel buyers, in the Sunday edition. Here’s another perspective I thought of after reading it: I hope that this year’s current market, which includes a high percentage of mill index […]
Steel Market Update received a number of comments regarding our “Tsunami” article published in Sunday evening’s issue. A large service center shot us an email about something they were seeing in their market. We did some checking with other service centers and did not see this as a pressing issue but we might be in […]
The move by ArcelorMittal USA today was anticipated and the price levels noted in their increase email to their customers are in line with expectations. I expect the rest of the mills will follow along within $10-$20 per ton of the levels suggested by AMUSA. Some of the mills may wait for scrap prices to […]
Flat Rolled Steel Service Centers Comment About Their Relationship Customers Late last week Steel Market Update started canvassing flat rolled steel distributors about their customer base in an effort to better understand the psyche of their customers. We found there are essentially three camps buying from the domestic steel service centers: 1) Contract customers tied […]
Double digit flat rolled steel price moves seem to be a weekly occurrence over the past few weeks. Steel mills are controlling their flat rolled steel order books and restricting spot tons. Those buyers who did not recognize things were changing back in the fall when Steel Market Update began pointing out the changes in […]
Last year in conjunction with Steel Success Strategies I had a lunch with a number of steel buyers, executives and two derivatives traders (one being Andre Marshall of Crunch Risk, LLC). We all gave our opinions as to where we thought benchmark hot rolled coil would be by early June 2016 when we will return […]
Steel buyers are beginning to brace themselves for what may well be another tumultuous month of allocations, closed order books and even higher steel prices. At this point it is a foregone conclusion with most buyers that there will be another increase. The question really is how much higher will prices go during the month […]
The following article on the hot rolled coil (HRC), busheling scrap (BUS), and financial futures markets was written by Dave Feldstein. As Flack Steel’s director of risk management, Dave Feldstein is an active participant in the hot rolled coil (HRC) futures market and we believe he will provide insightful commentary and trading ideas to our […]
Last week Steel Market Update reported our Steel Buyers Sentiment Index as being at record highs. Buyers and sellers of flat rolled steel are very optimistic about their company’s ability to be successful not only in the current market but three to six months out into the future as well. When looking at Sentiment from […]
I am going to start my Final Thoughts today with a question. I am working on an article as part of my The Truth About Selling Steel series and I want to learn more from buyers and sellers of steel as to what the term “Value-Added” means? We hear this term used a lot in […]
What makes indexing flat rolled steel prices so difficult right now is you have steel mills quoting lead times that may be in May, June or even July for the same product. A hot rolled order placed on SDI last week is actually being produced at the same time as one placed on AK Steel […]
Earlier today CSN began informing their U.S. customers importing flat rolled steel from them that there has been an accident at their #3 blast furnace in Brazil. The blast furnace, which was just coming back into operation after a 10-day scheduled maintenance outage, will now be down for an “undetermined” amount of time. SMU sources […]
Earlier today, Steel Market Update participated in a steel conference call hosted by HARDI. Every month the wholesalers who sell galvanized sheet and coil steel to the HVAC industry conduct an informational conference call to evaluate what is happening in the North American market. Over the past few months we have seen the wholesalers much […]
WASHINGTON, April 26, 2016 /PRNewswire/ — Today United States Steel Corporation (NYSE:X) filed a complaint with the U.S. International Trade Commission (ITC) to initiate an investigation under Section 337 of the Tariff Act of 1930, against the largest Chinese steel producers and their distributors. The 337 complaint alleges illegal unfair methods of competition and seeks […]
US Steel Corp. announced a net loss of $340 million for first quarter 2016 and a segment EBIT loss of $242 million or $70 per ton. “It’s my perception that we have probably seen bottom,” said president and CEO Mario Longhi to reporters following U.S. Steel’s shareholder meeting Tuesday in Pittsburgh. US Steel began first […]
Steel Market Update received the following email from a large service center in the United States. This executive, who wished to remain anonymous, enjoyed the article we produced in Sunday evening’s edition of our newsletter entitled, “2016 To be a Year of Volatility?” This executive discussed the issue of supply and the possible reversal of […]
This evening I was talking with a large steel buyer about the fundamentals of the steel market and how long can prices continue to go higher. I told him that I had spoken with another large steel buyer earlier today who told me they could not understand how the fundamentals have changed in China. They […]
According to our latest flat rolled steel market survey which was conducted last week, steel mill lead times have continued to move out on every single one of the flat rolled products. The extended mill lead times are one of the primary reasons behind the increases in flat rolled steel prices, pressure on deliveries, allocations […]
The graphic used in this article visually tells the story. Flat rolled steel prices have become much less negotiable according to those taking our flat rolled steel market trends survey this past week. Lead times are extended and steel mills are using the words “allocation” and “controlled order entry” to their advantage. The net result […]
This may come as a surprise to some but, there are many who think 2016 may be one of those years where flat rolled steel price volatility, maybe even extreme volatility, could become the norm. We are now in the midst of a five month upswing in flat rolled steel prices which has taken benchmark […]
First, Steel Dynamics Industries (SDI) reported an increase in steel shipments (+17%) and that they were continuing to grow, “…across all divisions but most significant in flat rolled.” They went on to report customer inventory levels are now “better aligned with actual demand, which is supporting increased domestic steel production and now also flat rolled […]
The steel indexes followed by Steel Market Update showed flat rolled steel spot prices continuing their climb higher as all products moved by double digits. Both Platts and SMU took hot rolled prices up by $15 per ton, although there is a $15 per ton spread between the two indexes. Based on the SMU index, […]
We wrote an article recently (Price Announcements Put Spot Numbers in Clearer Focus, SMU April 17, 2016) which contained an error regarding AK Steel’s “minimum” spot pricing on hot rolled, cold rolled and galvanized spot pricing. The table below references each of the AK Steel price announcements and where their minimum base price numbers should […]
My focus over the next few days is going to be on demand and how demand will impact the flat rolled steel markets over the next couple of months. I began the process by looking at the Steel Dynamics earnings conference call transcript for hints as to how SDI sees the market progressing through 2nd […]
Buyers and sellers of flat rolled steel continue to feel very good about their company’s prospects both in the existing market as well as looking out three to six months into the future. Steel Market Update (SMU) is of the opinion buyer optimism is connected to rising steel prices around the world which improves the […]
On Wednesday afternoon the Nucor Plate Mill Group announced a new price increase on all new orders as well as all existing spot orders acknowledged for the week of June 4th production and beyond. Plate spot prices will increase by a minimum of $40 per ton. We have seen flat rolled steel price increase announcements […]
It is still a little early to get a solid read on the ferrous scrap market and May pricing, but the indicators are pointing toward higher pricing. We heard from a number of our scrap sources over the past 24 hours and their guidance has been toward the scrap markets moving anywhere from $10 to […]
Steel buyers need to be aware that there has been a jump in iron ore spot pricing in China over the past 48 hours. The Steel Index (TSI) reported 62% Fe fines into the port of Tianjin, China at $64.3/dmt (dry metric ton) up 4 percent from the previous day. This same item is up […]
In order for prices to reverse course, service center inventories will need to grow which would ultimately slow mill order books and relax lead times. The service centers we spoke with today were almost unanimous in their opinion that now is not a good time (or any easy time) to build inventories. However, there were […]
California Steel Industries (CSI) opened their July flat rolled order book this week. The mill moved prices up by $80 per ton compared to the previous month. We are investigating exactly what that means to buyers. We understand that the mill is on a strict allocation to their regular customers. We expect the mill to […]