Week-in-Review: Steel Prices Rally, Shutdowns and Anti-Dumping Actions Continue
This week saw metal prices, particularly hot-rolled coil and cold-rolled coil steel, rally even as major steelmaker Tata Steel announced it was abandoning the U.K. market because of regulations and low prices.
Free Download: The March 2016 MMI Report
Markets can sometimes appear paradoxical that way. Steel-Insight’s James May elaborated that it’s actually curtailed supply that has helped prices increase here in the U.S. Bye, bye, oversupply!
Steel Prices Rally, Speculators Arrive
Another factor, at least for steel ingredient iron ore, was more trading activity in China as investors are looking for short-term returns rather than investing in iron ore long-term there.
Back here in the U.S., steelmakers are cautiously increasing prices of rebar and other products as the construction season begins in earnest in the East and Midwest, testing the waters of recent commodity price increases.
So, speculative buying, price increases despite demand levels that are still relatively flat and more supply shutdowns are all happening. Is it any wonder that Barclays is warning investors that commodities, overall, could experience a “rush for the exits?”
They’re not the only ones saying Q2 could be bad, either. Our own Raul de Frutos wrote that markets could change direction, big-time, in the next quarter.
Anti-Dumping 2: Electric Boogaloo
It also wouldn’t be a day ending on y, these days, either without mentioning dumping, dumpling. Was that too friendly? Sorry.
Free Sample Report: Our March Metal Buying Outlook
My colleague, Raul, explained the effects anti-dumping duties have had on hot-rolled coil, cold-rolled coil and hot-dipped galvanized steel prices here in the U.S. Another investigation into phosphorous copper from South Korea was opened this week, too.
If you wanted an eventful week in steel, you got it.
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