SJF's Material Handling Blog
Okay – I’ll admit it, this post is a shameless plug for our online store, but I think you’ll agree that these products are both unique and in the right situation, very useful. So…without further delay – here they are.
In September, US scrap market insiders are expecting a major drop in prices. In some regions of the country, scrap prices have already started to decline in recent days. Shredded scrap prices could fall by as much as $155 /lt to a level of around $400 /lt; while HMS I is expected to drop by around $145 /lt to the level of $300 /lt.
The huge price drop is mainly due to the weak export market,. Turkey, which is traditionally the leading scrap importer from the US, enters the month of Ramadan at the start of next week along with the Middle Eastern countries, and, therefore, foreign scrap demand may continue to be slow in September. The market is still looking for equilibrium, so prices are expected to settle more next week with the new pricing levels becoming more apparent. Source: SteelOrbis.com
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In the past it took time to bargain hunt, going from shop to shop comparing prices, but these days there are websites which do all the work for you. You will not even have to navigate between websites; all you need do is log onto an online shopping website which offers a price comparison service.
By searching for a specific product on a good price comparison site you will be able to view the product at different prices, as offered from competing sellers. Essentially they are fighting it out against each other in order to make the sale, leaving you, the consumer, to reap the rewards of their battle.
So how do you go about finding that item you’ve been daydreaming about? Simply type in a suitable phrase in your favourite search engine, try “compare prices for” or something similar, and find a site that offers price comparison services. Navigate your way onto the website and look for a category list; you should be able to search within the categories for the specific item you’re looking for. You may even find the item on a list of popular products.
Once you have found the item you are interested in buying, you can compare the price differences between different online sellers. The way the price comparison websites work is by allowing online sellers to sell through the comparison site, so you can view the product information from various sources in a standardised format, and then choose the best price and buy.
There are a few things to keep in mind when shopping online in this way. Naturally you would like to find the best price, but what you are really after is the best deal. The difference between getting a cheap price and a good deal is in the quality of the product you are buying. Make sure that you are purchasing an item of the quality and standard you require. Comparing digital cameras in general may result in you finding a cheap camera, but be sure that it has the features you want and that it is from a reputable manufacturer.
The quickest way to shop would be to know the exact product you are looking for, which would allow you to search by the specific item name or model number. This will allow you to compare prices on the specific model from a specific manufacturer. Here you need not worry about comparing functions, because you know exactly what you are getting. Although this way of shopping is quick and easy, it may pay off to look at products from rival manufacturers, as they may have a similar item at a lower cost, making for a great deal.
Source : Deals Space.net (www.deals-space.net)
U.S. Steel has been informing their customers of a price increase on all flat-rolled products. The increase is $40 per ton ($2.00/cwt) over their existing spot prices.
This puts the Hot Roll spot base at $55.00/cwt ($1,100 per ton), Cold Rolled at $60.00/cwt ($1,200 per ton), Galvanized at $61.00/cwt base ($1,220 per ton) and Galvalume at $61.50/cwt base ($1,230 per ton). My understanding is the prices are effective September 1, 2008.
Some have suggested U.S. Steel may be “posturing” to fill their August order book. However,some U.S. Steel customers are concerned requests for more tons during August resulted in “no availability” answers.
ArcelorMittal responded later in the day and starting informing their customers they would match the U.S. Steel increase of $40 per ton ($2.00/cwt) on all flat rolled products. However, ArcelorMittal is making the increase on hot rolled coil effective with any new orders for August. Cold rolled and Coated (Galvanized, Galvalume) would become effective on September 1st.
Information courtesy SteelMarketUpdate news.
I have been watching scrap prices over the past few weeks since Chrysler stopped the auction process which was used to create the prime bundles market pricing. According to Steel Business Briefing’s scrap reporter, with whom I converse on a regular basis (who is a steady reader of the Steel Market Update and calls my newsletter a “must read”); the price of prime scrap has risen by $130 per ton to $885-$900 per ton since June.
Shredded scrap has been moving higher as well and is currently being quoted at $600-$610 per ton and is believed to have room to move even higher as the month progresses due to the wide spread between prime bundles pricing and that of shredded scrap. According to SBB’s sources the expectation is for shredded to go to $620-$640 per ton.
Scrap is used by all mills – whether fully integrated (BOF) or mini (EAF) and a number of mills are reported to be short scrap at the moment.
Higher scrap prices are going to put pressure on the domestic mills to keep prices up and perhaps be used in both contract negotiations as well as spot pricing as a reason for prices to go higher in the future. I am not advocating higher prices just trying to keep you aware of price pressures that may come back on the steel buying consumer at some point in time.
Everyone wants to blame “speculators” on the rising price of oil, steel, iron ore and various other commodities. It is an easy way to explain soaring commodity prices. However, the credit crisis may well be the culprit and the problems may continue to exist to years to come.
The way to get prices down for steel and other commodities is to increase supply relative to demand. Unfortunately, as many large companies already know credit agencies and banks are not willing to take the risks necessary to fund large venture steel and mining projects (thus increasing supply).
Mr. Dan DiMicco,president and CEO of Nucor, brought it home when he told the audience in New York last week, “…the credit agencies have tightened up their sphincters so much that they’re not even willing to talk to the highest-rated investment grade mining and metals company in the world and keep their rating if we borrow $3. So, we are paying the penalties of the bankers on Wall Street and the other banks around the country and rating organizations that were broke and hopefully will be fixed.” Nucor recently had to do a secondary stock offer to raise $2 billion dollars.
If you read my articles last week about the growth of the demand for steel in the world at between 3%-6% meaning as much as 90 million tons of new capacity will be needed each year, then you are aware the need for iron ore, metallurgical coal, coke and other steel making inputs will be necessary. What hasn’t been explained to the steel using community is the devastating affects the credit crunch is having on large companies such as Rio Tinto, BHP Billiton and even more damaging to smaller mining concerns. According to Jeff Christian, managing director of CPM, a New York based commodity advisory firm – “The financing on those mining projects has slowed to a trickle.” He believes at least two years of development work and perhaps as much as five will be lost before the credit crunch is over.
This will keep commodity prices high for years to come.
That will keep steel prices much higher than we can now imagine – for years to come.
Don’t be tricked into believing the current weakness in U.S. prices (mostly related to galvanized) is going to be a long term trend. (Resource: TheStreet.com)