Final Thoughts

One item I keep hearing from the service centers I speak with – and it doesn’t matter what the product is – hot rolled, galvanized, Galvalume I am hearing the same thing. Business is good, in some cases excellent, but margins are being squeezed. Competition appears to be willing to move off inventory for whatever reason and at whatever price. As one large service center put it, “The competition has lost price discipline.”

We had one service center in the Houston area tell us that they are worried about all of the cheap steel sitting at the port and more coming in. They reported inbound Russian hot rolled in the $580-$585 range CIF, Duty Paid, Port of Houston. Deliveries at that price level are coming through the remainder of the year. The new price offers on Russian HR into Houston are $610 per ton but we don’t believe there will be many buyers at that price with domestic HR numbers sliding at this moment.