Steel Supply Chain Decline
“Have scrap steel prices finally found a floor?”1 The decline in steel prices is slowing as scrap markets look for signs of positive change. Late last month, the Commodity Trade Risk Management group published new prices for hot-rolled coil, which evened out at “$440/st, down from about $640/st last November”.2 CTRM also reports that recent price hikes in ferrous materials will stabilize the market, but won’t offer a price rally for most of the year.
“The price hikes announced so far this week have been a bit scattered, a mix of formal moves and higher mill quotes. The market has taken this development as a sign of better times.”2
U.S. steelmakers are also asking congressional leaders to address global supply chain regulations that hinder domestic growth.3 Their goal is to focus international trade cases on earnings, rather than profit levels, as a direct driver of lost domestic jobs and production. That case will be hard to make as U.S. steel demand grows, while demand in China and Europe has fallen. Diversified domestic operations, including the car donation industry – in particular American Cancer Society donations – has propped up small areas of the market, and may contribute to growth in the fourth quarter.
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