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As many of you know, the administration has put o; a decision on Section 232
until a;er tax reform legislation has been completed. The report from Ross is due
to the president in mid-January, a;er which he has 90 days to act on it. At this
point, most governmental observers believe that if anything is to happen, it won’t
occur until mid to late Q1 2018. And it no longer seems like a slam dunk that the
steel industry will reap any benefits from Section 232. SMU has been hearing from
steel mill executives who say they never asked for 232, have no expectations, and
are now concentrating their e;orts on traditional AD/CVD trade remedies.
A Word About Service Center Inventories
Previously I have spoken about the new proprietary analysis SMU has been
working on to measure the number of months of inventory flat-rolled steel
distributors are carrying on their floors at the end of each month. As of mid-November, we have just completed our analysis, and the months of supply of
flat-rolled on service center floors in the U.S. at the end of October is essentially
the same as what we recorded at the end of September. With 90 percent of the
registered service centers reporting, inventories stood at 2. 86 months of supply at the end of October compared to 2. 89 months at the end of September.
Note: As we add service centers, we revise previous months of supply as new data
Looking at the data a little closer, 50 percent of responding companies reported their inventories as shrinking compared to the previous month. The changes
were mostly subtle ( 2. 90 down to 2. 88 months of supply, for example). Forty percent of the responding companies reported their inventories as rising. Ten percent of the companies reported their number of months of supply as being the
same as the prior month. No one expressed any comments or concerns about
having too much or too little inventory.
If you have any interest in learning more about steel pricing trends or the
steel market in general, consider these 2018 events:
• SMU Steel 101: Introduction to Steel Making & Market Fundamentals Workshop,
Jan. 24-25, Mobile, Ala. This session includes a tour of the SSAB Alabama steel mill.
• SMU Steel 101: Introduction to Steel Making & Market Fundamentals Workshop, March 28-29, Merrillville, Ind. (just outside of Chicago). This session includes a tour of NLMK USA’s Portage, Ind., steel mill.
• SMU Steel Summit Conference, Aug. 27-29, Atlanta. This is the largest steel
conference of its kind in North America.
Details on all events, as well as information about SMU newsletters, can be
found at www.steelmarketupdate.com or by calling 800-432-3475.