The Rising Influence of Rising Affluence

[DewDiligence]

US steelmaking outlook bullish, says Barron’s:

https://www.barrons.com/articles/tariffs-giving-steel-prices-another-nudge-1520532179

Futures prices for U.S. Midwest domestic hot-rolled coil steel settled at $875 per short ton on Wednesday, up 6% so far in March, after a nearly 13% jump in February… Prices then posted a nearly 5% rise on March 1, after the president’s tariff announcement.

…“Anytime the U.S. general economy grows by nearly 3% GDP, steel benefits,” says Joseph Innace, S&P Global Platts’ editorial director for metals Americas. “The three pillars of steel demand are construction, automotive, and energy. These steel-consuming sectors are all doing well concurrently.”

…CFRA [a commodities market-research firm] expects pricing for domestic hot-rolled steel to average from $800 to $850 per short ton this year, with the average “likely biased to the upside” if Trump follows through.

…CFRA has “strong buy” on AK Steel Holding (ticker: AKS), Cleveland-Cliffs (CLF), Steel Dynamics (STLD), and United States Steel (X).

…“We anticipate President Trump will not back down from his promise to level the global playing field and force China’s hand to accelerate ongoing supply-side reforms in Beijing,” [CFRA analyst] Miller says.

…U.S. demand for steel…will probably grow at a pace similar to last year, up 7.5%, to about 127 million net tons, he says.

…concerns about a worldwide trade war are overblown, [Innace] says. “…Steel companies in the U.S. have a long history litigating unfair steel trading practices of other countries, especially in recent years.” Trump’s tariff plan “will be a big hammer to drop for sure, but it’s not new, and not a surprise.” Trump has been “telegraphing action to help steel since the campaign.”