Final Thoughts

.One of the subjects of conversation I had with a number of buyers is what do the domestic steel mills need to do to break the foreign import cycle? There are some who believe that the steel mills will be best served by letting the prices drift down to the point where the spread between U.S. prices and that of the foreign competition are too close to justify importing steel. The number discussed by some of the buyers (and referenced in our pricing article above) is about $500 per ton ($25.00/cwt) on hot rolled. That would be a painful number for the domestic mills, especially the integrated mills. However, scrap is forecast to drop from where it is today in the coming months which could help the mills squeeze out the foreign excess tonnage.

We spoke with a manufacturing company this afternoon who has been a regular buyer of foreign coated steels and their comment was the domestic coated number may need to be in the $28.00/cwt base range to compete against some of the Asian numbers. Taking extras into consideration this is also a possibility on light gauge coated where the mills have some extras to play with.