Final Thoughts

The ruling regarding the preliminary determination of dumping of hot rolled steel out of Australia, Brazil, Turkey, Japan, Korea, the Netherlands and the United Kingdom was announced this evening. You will hear split opinions as to whether the ruling is a “win” or “loss” for the domestic steel mills. It is my opinion that this is a “win” for the domestic steel mills in that a number of countries will have to cease quoting and shipments to the United States. This includes Brazil which was becoming very active in the spot market, which is really what the mills want to control – trying to stop the low end of the market from making too many inroads into what the domestic mills consider to be their market.

The amounts of the cash deposits were higher for many countries than what was expected. I had spoken to one of the Brazilian companies about their expectation last week and they were expecting dumping rates of approximately 18 to 20 percent. Instead they received rates at almost twice what was expected. In any case, Brazil will be out of the U.S. hot rolled market and one company which will be impacted is the CSN steel mill located in Terre Haute, Indiana.