Steel Products
February 18, 2021
SMU CEO Believes Steel "Super Cycle" Has Started
Written by John Packard
It is my opinion the U.S. is entering a “super cycle” that will be good for the steel industry and could well keep steel prices above the historical $600-$650 per ton average on benchmark hot rolled coils. This does not mean prices won’t scale back once more supply comes into the market. I am of the opinion it is in no one’s best interest – steel mills or their end customers – to keep prices above $1,000 per ton (SMU’s HRC index is $1,200 per ton this past week).
What is going to propel the super cycle? Inventories remain low at service centers and the end manufacturing companies. It may well take into this summer before inventories become balanced. One mill told us they will not have many spot tons available until June as they are dealing with the large number of late orders they have in their pipeline.
