Steel industry health check
Steel imports are a key driver of US steel prices. Investors should closely follow monthly import figures, as they serve as the steel industry’s virtual health check.
In this article, we’ll look at a breakup of February 2017 steel import data.
Imports of blooms, billets, and slabs rose 265% year-over-year (or YoY) in February to 580,000 metric tons. It’s important to note that ingots, slabs, blooms, and billets are all semifinished steel products (NUE). These products have to be worked on more before end consumers can use them.
ArcelorMittal (MT), for example, imports semifinished steel slabs to the United States (DIA) (DOW) from its facilities in Brazil. The semifinished steel is used as a raw material for its Calvert facility, a steel plant located in Alabama.
Flat rolled products
Flat steel products consist of sheets and plates that are used in a wide range of industries. HRC (hot rolled coil), CRC (cold rolled coil), and HDG (hot dip galvanized) sheets are among the most widely used flat steel products. In 2016, the United States slapped strict anti-dumping duties on the imports of these products from countries including China and Korea.
We saw a steep fall in flat steel imports in the immediate aftermath of these duties as existing supply lines dried out for US importers. U.S. Steel Corporation (X) and AK Steel (AKS) are primarily flat steel producers and are affected by flat rolled steel imports.
In the next article, we’ll look at February’s flat rolled steel imports in detail.