Get Ready, Let’s Go ...
Spring is here, oh wait, it is still winter. Hard to believe for those of us in the Midwest and South that we have had such a mild winter and the high temperatures.
Now let’s turn our attention to another temperature, the ferrous market. Hot, Hot, Hot! We have seen a consistent upward trend and even when we did see a little pull back and some talk of a pull back, something happens to dampen that fire. Like a politician, I would like to take full credit for this uptick and promise you it will continue. Ok, well maybe not forever, but the short term still shows promise.
I often get asked what it is that impacts the ferrous market. I have done presentations on this, spoke to many of my colleagues about it, and still do not find any single item that has that magical power other than one “DEMAND.”
Some things that have occurred have stoked the demand aspect such as a proposed $1 Trillion – yes that’s a T as in Trillion – infrastructure spending proposal and relaxing many regulations that have been choking off demand for projects.
When we go thru a period of strong mill demand, it eventually depletes any scrap inventories and then all it takes is one of any number of other factors (export demand as one example) to stoke the fire. I do find it odd that the mills got into the scrap business to lower volatility. I would suggest instead that it has actually created more volatility as market swings are now common in the $20-$30 range, and that used to not be the case.
I do want to remind you of the upcoming convention in April in New Orleans. We hope you can make it and will come to the Ferrous Division meeting during our board meetings. I also encourage you to attend the Ferrous Spotlight where we will try to bring you current information to help you understand this complex business in which we operate.
ISRI Ferrous Division Chair