Steel prices

[steelman]

Some FYI for everyone.

I have been selling steel buildings for a living, for the past 10 year. Anyway, I just received an internal memo that the mill where we buy or steel from will be increasing their prices.

from the memo, "Recently, there have been indications that the steel mils were going to begin pushing for additional increases. These indicators include the spike in the price of scrap coupled with consecutive weeks of gains at domestic mils. This activity has once again generated price increase announcements from the mils. These increases will go into effect in January and we have no option but to pass them along."

If anyone knows the best way to make some coin with knowing this, please let me know.

Best,
Steelman

[peanuts]

Hey Steelman,

I was in the steel industry for a long time, but not as an end user. The company I was with was a input to the costs of producing steel in the US.

I'm sure that you've read this article, or have heard the gist of it somewhere:

http://finance.yahoo.com/news/US-moves-to-place-new-duties-apf-3056097711.html?x=0&.v=11

Sure, this article is only about pipe. But, I promise you, it will expand to other steel products. The duties will open the door for US mills to increase their prices overall. The actual implications are that US producers of steel and steel products will increase pricing of products in USD... but what is a dollar going to be worth? That's the real question.

What I'm getting at is that the costs of inputs are increasing, and the steel companies pass these costs along to their consumers, who pass these extra costs onto you, who will in turn pass the costs down to me, the end user. Margins don't increase, only the volume of money. This is the effect of inflation. Fully integrated mills should be able to increase their margins slightly. X and MT come to mind.

My advice to "make some coin" off of this is to trade the commodity. Buy when the price is low and sell when it's high... repeat. Either that, or drastically increase your prices to consumers, so that you are selling at a higher percentage than by what the mill is increasing raw material price.

[steelman]

Peanuts,

I noticed you are in Pittsburgh. The company I work for is out of McKees Rocks and our factory is in Ambridge.

[peanuts]

Peanuts,

I noticed you are in Pittsburgh. The company I work for is out of McKees Rocks and our factory is in Ambridge.

I probably know it through past relationships.

I work only a few miles from each location.