Stelco Holdings Inc T.STLC

RE:What if steel prices don't return to normal?

[dieter216]

Correct....this is the new normal. HRC prices won't be headed back to pre-covid levels. (there won't be a lumber type correction in steel prices) Why?? - There has been consolidation in the US market, supply controlled by fewer players who like these price levels. - Ocean freight rates have tripled in price, making imports less attractive. -China and Russia placing duties on steel exports which affects world spot prices. -Demand to remain strong in the near term with Automotive industry playing catch up to demand. Will prices remain at $2,000+ cdn long term? Probably not. But you won't see steel prices headed below $1,200 and at this price level, down 40% from current levels, Stelco is still very profitable. What's happening now is a long term cyclical trend.... GLTA Dieter