Steelmakers Gird for a Downturn

NEW YORK (Reuters) - America's steel industry, for decades a symbol of industrial decline, is betting on natural gas to make it more competitive against foreign producers. U.S. Steel Corp and Nucor Inc , the two largest U.S. steel producers, are changing their traditional manufacturing processes as relatively cheap domestic natural gas supplies become more plentiful. Some experts believe the new techniques will not only allow steelmakers to cut costs and lower selling prices at home, but also give U.S. ...

Michelle Galanter Applebaum submits: SummaryAs the world prepares for the upcoming Sino-US Strategic and Economic Dialogue in Beijing on May 24-25, China is attempting to move the world’s attention from the real center stage event – currency pegging and increasing trade imbalances – to a tiny town in Mississippi by announcing a $175 million investment by China’s Anshan Steel in upstart Steel Development Corp today.

Michelle Galanter Applebaum submits: Baosteel Increasing February Sheet PricesAccording to press reports, China’s price leader Baosteel announced a planned 5% price increase on flat-rolled steel for February shipments, marking the third consecutive monthly rise. With January hikes now sticking well, we expect to see further price increases announced in China as well as Europe and the US.

In the wake of a global crash on the the price of steel, led by falling demand, banks in China have gone to warehouses to seize assets of companies in default. However, commodities pledged as assets for loans, simply are not there.

ByJeffrey Friedland:The steel industry in the United States has been singled out as a bright spot in the global steel industry, with U.S. Steel Corp. (X), Nucor Corp. (NUE) and AK Steel Holding Corp. (AKS) being key beneficiaries.

Michelle Galanter Applebaum submits: Volatility Bites Back. What China giveth, China taketh away. Steel prices are down some 5-10% globally due not so much to a slowing of economic growth in China, but due to worries of slowing.

ByJeffrey Friedland:2013 is starting out to be what will likely be a good year for some steelmakers, coming off of last year's tough operating environment for most steel producers worldwide. Last year, there was excess steelmaking capacity and supply in certain regions, and these factors are continuing to impact the industry this year.