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Well hello there darling little chart
stay out, i've got a massive email to send you. Large PDF file.
nice move here. waiting for consolidation to around 4 and under again. hopefully we'll get it.
Bearish article on metals in today's FT: "Mining and metals prepare for lean times" ( http://www.ft.com/cms/s/0/890e4f94-9a51-11dd-bfe2-000077b07658.html ). Excerpt:
"The mining and metal industry is bracing for months of price weakness as slowing demand in the US, Europe, Japan and some emerging markets, including China, is likely to push commodities such as copper into surplus.
At the London Metal Exchange annual dinner last night, the premier gathering of the industry in London, the mood among traders, bankers and mining executives was gloomy, particularly with regard to the short term.
"With the likelihood of a global recession rising, industrial metals prices will face further downward pressure," said a report by Francisco Blanch of Merrill Lynch.
Tight credit is further dampening demand for raw materials, as traders are unable to secure credit lines to move their commodities."
yo realest thanks for the hot info, again:) so yeah, i sold most of my position a while back. actually moved a lot of it to load SUTR under 3.00 last few days. But, I still hold a core just because GNA has been so good to me:)
So, a buck? really?? I see what your saying, but I just can't imagine a giant like GNA going down 10 fold. so they're stuck with inventory yes, folks shopping elsewhere for prices, means a few bad quarters. Naturally this will only deplete the share price, but considering the market as a whole has sold off also it doesn't make me worry as much. one may look at it as a great buying opportunity...no?
so we need some price adjustments and the whole financial mess to turn so the market can make up the losses. plus, steel has looked bad before, only to recover. what do you see different this time then the other impending doom days for the big boy steelies? :)
After this watch out below..... GNA going to a buck my friend if things don't improve :(.
In the sense of fairness, right now our major building sales are climbing, however, we're quoting more of them because our regular old reliables are falling. There is a bad side to this as well for the industry. I work for a small company, when folks start shopping us against the bigboys and we're winning it means the bigboys are stuck on high inventory and they will choke on it. As our pittance of steel volume increases in some stock theirs will plummet 10 fold most likely.
Keep a careful eye on the commercial construction industry. If it dies off, GNA will suffer unless they can export.
you may see 7 again.
waiting this out. hopefully we see 10 again
thanks realest!
Bear in mind, that 10Q is only their opionion of the market.... endusers are chocked full of inventory.
it is for the second Q. They aren't telling you that they are dead in the water right now though. I'll try and get a feel for how well GNA is really doing.
We use alot of their material and we are slowing up big time... their future bookings are very very likely to be super soft. They have enacted price hikes, but you need to pay special attention to the tonnage produced.
15.10 bid! wooo good stuff! --> While we continue to experience significant inflation in our raw material costs, we have been able to increase selling prices to preserve our margins. North American demand remains solid across our main product lines including rebar, merchant and structural bars and wire rod. In addition, we have been able to supplement our North American shipments with strategic export opportunities to keep our facilities operating at near capacity levels.
Our customer base has shown resilience to the general weakening of the North American economy as our order backlog remains solid and new contract activity continues in our downstream business which is a leading indicator for our mill demand. This, combined with import levels which have moderated from historical highs, global steel demand remaining strong, and relatively low inventory levels throughout the North American system, gives us a positive outlook for the coming months."
http://biz.yahoo.com/prnews/080806/to625...
and i didn't pull the trigger yesterday. DOH!!
damnnnnnnn good news if you ask me. 8:06AM Gerdau AmeriSteel beats by $0.14, beats on revs (GNA) 14.00 : Reports Q2 (Jun) earnings of $0.64 per share, excluding non-recurring items, $0.14 better than the First Call consensus of $0.50; revenues rose 91.2% year/year to $2.54 bln vs the $2.5 bln consensus.
lol. no worries.. i hear ya:) and thanks!
next year..... short this puppy ruthlessly for the moment. I'll be sending you news... i've been lazy.. sorry. LOL
morning realest. when do we buy again?
will do. look forward to it, thanks bud.
Yep, but be careful... i've got some news coming your way.
been a nice bounce off the 200MA. GNA is a strong one. so is my sutr. i will have to get more when she pulls back again
i see that. thanks for that article you sent me.... ill load again when this oversold, looks like SUTR will be down for a while too.
Getting crunched today. Coming months may not be so hot for her.
Shares of steel maker Gerdau Ameristeel hit record
Steel maker Gerdau Ameristeel hits all-time high before succumbing to broader market downdraft
June 26, 2008: 01:42 PM EST
NEW YORK (Associated Press) - Shares of steel producer Gerdau Ameristeel Corp. hit an all-time high Thursday before retreating on a severe downdraft in the broader market.
Gerdau's shares, which have ranged from $9.60 to $19.67 in the last 52 weeks, climbed to a record $19.79 shortly after the opening bell before easing back 51 cents to $18.93 in afternoon trading.
Since the start of the year, the stock has gained nearly 37 percent, easily outpacing the Standard & Poor's 500, which is down 10 percent over the same period.
Gerdau's record high comes as investors bet on growing demand for steel from Brazil, Russia, India and China, among other non-U.S. economies, Goldman Sachs analyst Sal Tharani said recently.
Last month, Gerdau Chief Executive Mario Longhi credited his company's record first-quarter performance on "strong global demand for steel has driven selling prices higher and provided us the opportunity to export our product globally."
Shares of Gerdau, which is based in Tampa, Fla., and owned by Brazil's Gerdau SA, fell shortly after setting a record high as a barrage of bad news weighed on the broader stock market: Another surge in oil prices and warnings of trouble in the key financial, automotive and high-tech industries.
The major indexes showed losses of more than 2 percent, including the Dow Jones industrial average, which shed more than 250 points and dropped to its lowest level in more than a year.
That sent some investors rushing for the safety of Treasury bonds -- government debt is a haven when the stock market is in turmoil.
http://money.cnn.com/news/newsfeeds/articles/apwire/52d9cb85525fd62271b4663c35f66d19.htm
I think it's bouncing around right now, neither making gains or losses.
the dollar continues to weaken, right?
Get ready for a 4th qtr pull back.
nope sorry... GNA- yet another new all time high;)
Anyone have an account with metal bulletin? There is news about Gerdau Ameristeel Corp activities.
Googled the company under News.
http://news.google.com/news?hl=en&ie=UTF-8&ned=us&um=1&tab=wn&q=Gerdau+Ameristeel+Corporation&scoring=n
hit another all time high today 19.10 :DDDDDDDD
back down now for a bit. Fuel costs and steel market is getting ummmm, not ugly..... but F'in Ugly.
GNA rippin it up!
Getting A Grip On Demand
Friday May 16, 5:56 pm ET
Investors Business Daily
J. Bonasia
Orange sparks fly from welding torches, and molten steel glows white in furnaces around the globe -- fitting metaphors for the scorching-hot demand for metal by the developing world.
An unprecedented need for steel in China and elsewhere is fueling demand for all industries tied to steel production. That includes the diverse sector of metal processors and fabricators.
Metal processing and fabrication ranked No. 12 among IBD's 197 industry group as of Friday. Related sectors such as steel producers (ranked No. 2) and metal ores firms (No. 13) are performing similarly well.
Metal processors and fabricators don't include the companies that operate mines to extract raw iron and other ores. That job falls to the big integrated steel makers such as United States Steel (NYSE:X - News).
But many processors and fabricators -- known as metal service centers -- also run steel minimills that recycle scrap metal from old cars and appliances. This stock group includes Metalico (AMEX:MEA - News), Schnitzer Steel (NasdaqGS:SCHN - News), Gerdau Ameristeel (NYSE:GNA - News) and Commercial Metals (NYSE:CMC - News).
In addition, some fabricators sell materials made from aluminum, copper, brass and other alloys. But steel remains by far the most important industrial metal.
1. Business
Metal processing service centers act as middlemen that buy steel in bulk. They store long bars or huge coils of flat steel in warehouses. The service centers cut and shape the steel into smaller, more useful forms before selling it to builders and manufacturers.
Two Ohio-based companies, Olympic Steel (NasdaqGS:ZEUS - News) and Worthington Industries (NYSE:WOR - News), supply lots of heavy-gauge, flat-rolled steel for heavy equipment manufacturers and aerospace clients.
Los Angeles-based Reliance Steel & Aluminum (NYSE:RS - News) also sells to some equipment makers. But Reliance is focused on small manufacturers and machine shops. More than half its jobs come from "callers today who want deliveries of processed materials tomorrow," says Reliance CEO David Hannah.
"Our business is based on quick turnarounds for small orders," he said. "We need to be in position with just the right inventory and stock, and we need enough truck fleets that are ready to deliver in time."
Reliance is perhaps the nation's most efficient service center, says Sal Tharani of Goldman Sachs. He rates the stock as neutral, but calls it his favorite pick in the sector.
"Reliance runs a very competent company with a lean organization in their central headquarters and an expansive network of shops," Tharani said.
The Reliance business model hinges on an ability to quickly deliver quality service in high volumes on very small deals. The company posted record revenue of $7.3 billion last year -- on an average order size of just $1,350 per deal.
Name Of The Game: It may sound obvious, but the goal through all steps of the steel producing and metal fabrication process is to buy low and sell high, says John Lichtenstein, executive partner of the Accenture metals industry practice.
"Wherever you are in the value chain, it's about the spread between what you pay for materials, and what you can charge your customer for the value you've added," he said.
Prices fluctuate, so service centers need to turn their inventories over quickly. Those who try to speculate too long can get burned, Tharani says.
In addition, the best service centers are able to pass along any added costs to their customers, says Bob Richard, a steel industry specialist with Longbow Research.
"When the price of steel goes up, these companies hope they can sell at that replacement cost above what they paid," he said. "In times of rapid price escalation, these companies do very well."
2. Market
A massive industrial buildup is under way in China, creating a nearly boundless demand for steel there.
Almost overnight, this trend has shifted industry dynamics for steel firms around the world.
China now gobbles up some 35% of the 1.3 billion tons of steel consumed worldwide each year.
Until recently, foreign steel makers often undercut the U.S. mini-mills.
But now, with the dollar so weak and fuel prices so high, most overseas producers have cut shipments to the U.S. as their products grow comparatively expensive.
That has created an opening for the American minimills. Some are even exporting steel for the first time in years. Even though scrap steel prices are still relatively high at roughly $600 per ton, the service centers can thrive by passing on cost increases to their customers.
The American market is mature, growing at about 2% per year. Gains are not derived so much from growth in volume as from price increases.
The U.S. consumes roughly 125 million tons of steel per year. About 20% of that amount goes into cars, 35% into nonresidential construction and 20% into machinery and manufacturing.
The remainder goes toward other uses. The U.S. housing downturn has not had much impact on this market, as few metals are used to build homes.
3. Climate
Some big steel makers have renegotiated labor contracts in recent years to bring down the costs of health care and pensions. But the most important recent trend in this decade has been a steady shakeout for the industry.
Lots of cheap foreign steel was being dumped into the U.S. market in the early part of the decade, resulting in more than 30 American steel mills going bankrupt from 2001 to 2003.
But the situation has improved, thanks to a steadily falling dollar and mergers and acquisitions that have cleared out the field.
Two years ago, Arcelor merged with Mittal Steel in a $38 billion deal that created the world's largest steel maker. U.S. Steel, Nucor (NYSE:NUE - News) and ArcelorMittal (NYSE:MT - News) now control about two-thirds of the world's steel supply.
In turn, the service center field has been whittled down. For instance, Reliance bought rival processors Earle M. Jorgensen Co. and Yarde Metals in 2006. This consolidation is not yet over, predicts Bill Larson, chief financial officer of Commercial Metals.
"The field needs still more consolidation to give producers greater pricing power," he said.
The biggest survivors have already helped stabilize prices for everyone, says Larson. He adds that it's best for each fabricator to join forces with a minimill to supply the needed steel.
"The fabricators that are going to prevail will be the ones that have steel mills behind them, because they have a profitable parent," Larson said. "All the other pure fabricators (without minimills) then become our other customers."
4. Technology
Not much has changed in the way of steel production over the past century. More computer systems and automation have been applied to the process. Yet the bedrock technology still involves the brute-force process of melting down metal and shaping it for users.
Recently, Nucor has refined a new way of making metal sheets by pouring molten steel directly into molds. This Castrip method allows steel mills to forgo bulky, expensive steel rollers that usually squeeze the metal into sheets.
The approach, developed in conjunction with partners from Japan and Australia, saves energy and makes it possible to build much smaller mills.
Nucor pioneered the industry's minimill breakthrough in the 1960s. Rather than rely on raw ore, producers started recycling old scrap metal.
Today the mills are working to make their processes more environmentally friendly by cutting down on carbon pollution and other emissions.
5. Outlook
Despite a poor domestic economy, this market remains resilient. Steel prices roughly doubled in the U.S. in the first half of this year, yet sales have still grown based on unequalled demand overseas.
"The important thing to know is this environment is unprecedented in our industry's history," said Reliance CEO Hannah. "The environment is different because there is no cheap import alternative."
Upside: Shareholders are flocking to this sector due to growth even with rising steel prices, says consultant Lichtenstein.
"Investors view the global steel industry positively," he said. "In North America, the industry is expected to maintain profits despite a market slowdown, due to a high degree of vertical integration and reduced imports due to the weak dollar."
Risks: Rapid improvement in the dollar's value could invite a flood of steel imports.
Another potential problem is China, which imports much of its steel from India and the Middle East and has been boosting its domestic production.
Though that country's growth remains strong, a slowdown could flood the world with a glut of cheap steel.
http://biz.yahoo.com/ibd/080516/industry.html?.v=1
SUTR flying AH's today-->http://biz.yahoo.com/e/080515/sutr10-q.html
It's another one i have not bought. Galvalume is in short supply, the price is high, demand in North America is under pressure from the credit crunch. I am not certain how overseas markets are taking this, the news i am catching are painting a struggling picture on the world market due to many real estate bubble bursts all over the world.
you see our SUTR eod yesterday and today??!
thanks, good post realest
But now, you need to worry about future earnings. Many steel producers forced us to take high volumes last month. Many of the end users are sitting on a month or 2 even perhaps more in some circumstances of product. This Q will be superb, but if the market decides they will struggle to sell to overstocked clients, then she plummets.
It may be a good idea to put some future puts out. Small amounts though, the steel market is unstable. Our prices are up almost 50% or more since 1/1/08. If our clients decide not to buy, then the manufacturers either must come down on price somehow. As steel price increases, and the dollar strenghtens, the danger of imports gaining entry again is also a concern. Keep an eye on the dollar. If Steel prices stay high and the dollar strengthens then import steel will rush back in to the market stifling the producers.
But now, you need to worry about future earnings. Many steel producers forced us to take high volumes last month. Many of the end users are sitting on a month or 2 even perhaps more in some circumstances of product. This Q will be superb, but if the market decides they will struggle to sell to overstocked clients, then she plummets.
It may be a good idea to put some future puts out. Small amounts though, the steel market is unstable. Our prices are up almost 50% or more since 1/1/08. If our clients decide not to buy, then the manufacturers either must come down on price somehow.
you got that right ba BOOM!!
She's about to really explode when this earnings call comes IMO.
yes i think so. this always takes a breather. try and buy when its oversold. a sure bet!
came close to 15 after hours but only 400 shares then. I think you will be able to pick it up between 14.50-14.75. But I stil think it will go lower than that
buy 50 at 15 if it hits it, this is going higher.
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Gerdau AmeriSteel Corp.
4221 W Boy Scout Boulevard
Suite 600
Tampa, FL 33607
United States - Map
Phone: 813-286-8383
Web Site: http://www.gerdauameristeel.com
Details
Sector: Basic Materials
Industry: Steel & Iron
Full Time Employees: 9,000
Business Summary
Gerdau Ameristeel is the second largest mini-mill steel producer in North America with annual manufacturing capacity of approximately 12 million tons
of mill finished steel products. Through its vertically integrated network of 19 mini-mills (including one 50% owned joint venture mini-mill), 23 scrap recycling
facilities and 60 downstream operations, Gerdau Ameristeel serves customers throughout North America.
The company's products are generally sold to steel service centers, steel fabricators, or directly to original equipment manufacturers for use in a variety
of industries, including construction, cellular and electrical transmission, transportation and automotive, mining and equipment manufacturing. It is found
in bridges, highways, stadiums, and commercial and apartment buildings.
Gerdau Ameristeel is 66.5% owned by Gerdau S.A. , the world’s 14th largest steel company, based in Brazil. In addition to the strong financial
base that Gerdau S.A. provides, the mutually beneficial exchange of operating, engineering, financial and marketing skills and cultures strengthens
both the Gerdau Ameristeel and Gerdau S.A. teams
.
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