Steel's (MTL) (GSI) (GGB) (HAYN) (IIIN) and China Demand

As goes China so goes the demand for steel, and in that regard it doesn't look good for steel companies like General Steel Holdings, (NYSE:GSI), Gerdau S.A. (NYSE:GGB), Haynes International Inc. (Nasdaq:HAYN), Insteel Industries Inc. (Nasdaq:IIIN) and Mechel OAO (NYSE:MTL) , which are going to be pressured in the years ahead from declining demand from the Middle Kingdom.

According to the China Iron & Steel Association, the Chinese government is pushing to slow down economic growth, which will result in demand for steel in the country to slow down.

Estimates under the current scenario for the steel sector have steel consumption declining in China by a minimum of 2.6 percent to as high as 4.6 percent in 2011.

Globally it doesn't look good for the next five years or so either, as the top estimates are for steel demand to grow at a 5 percent rate annually, although many think it'll be less than that.

In the short term, the U.S. steel industry should ship product at 14 percent above 2010 levels, reaching about 95 million tons in 2011.

All the companies are being affected by soaring iron ore prices and other inputs, which are putting stress on margins and earnings because buyers are hesitating to acquire product at too high of prices; something that will continue for several years.

For the steel industry, there isn't much to be optimistic about, no matter how the situation is spun. It's going to remain tough for some time.

Mechel OAO closed Wednesday at $25.77, falling $1.03, or 3.84 percent.

Steel's (AKS) (FRD) (NUE) (SUTR) (PKX) and China Demand

For the most part, as goes China so goes the demand for steel, and in that regard it doesn't look good for steel companies like AK Steel Holding Corporation (NYSE:AKS), Friedman Industries Inc. (AMEX:FRD), Nucor (NYSE:NUE), Sutor Technology Group, Ltd. (Nasdaq:SUTR) and POSCO (NYSE:PKX), which are going to be pressured in the years ahead from declining demand from the Middle Kingdom.

According to the China Iron & Steel Association, the Chinese government is pushing to slow down economic growth, which will result in demand for steel in the country to slow down.

Estimates under the current scenario for the steel sector have steel consumption declining in China by a minimum of 2.6 percent to as high as 4.6 percent in 2011.

Globally it doesn't look good for the next five years or so either, as the top estimates are for steel demand to grow at a 5 percent rate annually, although many think it'll be less than that.

In the short term, the U.S. steel industry should ship product at 14 percent above 2010 levels, reaching about 95 million tons in 2011.

All the companies are being affected by soaring iron ore prices and other inputs, which are putting stress on margins and earnings because buyers are hesitating to acquire product at too high of prices; something that will continue for several years.

For the steel industry, there isn't much to be optimistic about, no matter how the situation is spun. It's going to remain tough for some time.

AK Steel Holding Corporation closed Wednesday at $15.47, falling $0.36, or 2.27 percent.

Steel's (TX) (SYNL) (ROCK) (CHOP) (STLD) and China Demand

As goes China so goes the demand for steel, and in that regard it doesn't look good for steel companies like Ternium S.A. (NYSE:TX), Synalloy Corp. (Nasdaq:SYNL), Gibraltar Industries, Inc. (Nasdaq:ROCK), China Gerui Advanced Materials (Nasdaq:CHOP) and Steel Dynamics (NASDAQ:STLD), which are going to be pressured in the years ahead from declining demand from the Middle Kingdom.

According to the China Iron & Steel Association, the Chinese government is pushing to slow down economic growth, which will result in demand for steel in the country to slow down.

Estimates under the current scenario for the steel sector have steel consumption declining in China by a minimum of 2.6 percent to as high as 4.6 percent in 2011.

Globally it doesn't look good for the next five years or so either, as the top estimates are for steel demand to grow at a 5 percent rate annually, although many think it'll be less than that.

In the short term, the U.S. steel industry should ship product at 14 percent above 2010 levels, reaching about 95 million tons in 2011.

All the companies are being affected by soaring iron ore prices and other inputs, which are putting stress on margins and earnings because buyers are hesitating to acquire product at too high of prices; something that will continue for several years.

For the steel industry, there isn't much to be optimistic about, no matter how the situation is spun. It's going to remain tough for some time.

Steel Dynamics closed Wednesday at $17.36, falling $0.41, or 2.31 percent.

Metalico (MEA) (GSI) (AKS) (PKX) Close Up Even with Growth, Cost Concerns

The steel industry, even with some strong recent quarters, looks weak, as over the next five years it is expected to grow at a pace of about 5 percent or less annually, putting downward pressure on steel producers like Metalico Inc. (AMEX:MEA), General Steel Holdings (NYSE:GSI), AK Steel Holding Corporation (NYSE:AKS) and POSCO (NYSE:PKX), which closed up on Tuesday, even as they face the headwinds. And that's the more positive outlook by the majority of analysts. Many don't think growth will even happen at those modest levels.

A majority of steel companies are being forced to raise prices on their products in order to protect margins and earnings as the price of inputs and commodities rise.

That's not to say steel demand is falling, because it's not. But rising demand doesn't guarantee rising profits, as the industry is experiencing. A number of weak economies around the world could cut also into demand if steel prices and products rise to prohibitive levels.

Of course there a large varieties of companies with steel exposure, and each segment of the sector can represent strengths or weaknesses. So each unit and company will have to be watched closely for performance of course.

There's no way to spin the outlook for the steel industry in a positive manner. The industry will struggle for years even in the midst of strong demand as it attempts to work through the balance between steel demand, rising inputs, and ability for companies and countries to afford price increases from producers.

Some winners will emerge, but over time it's not easy to pick any one that's going to stand out. Some have looked to larger companies who may be able to navigate through the higher costs better, but we'll see if that's the case, as it isn't always that simple because of the wide variety of products and costs and pricing power with each one.

Schnitzer (SCHN) (STLD) (GNI) (SID) Close Mixed on Growth, Cost Concerns

The steel industry, even with some strong recent quarters, looks weak, as over the next five years it is expected to grow at a pace of about 5 percent or less annually, putting downward pressure on steel producers like Steel Dynamics Inc. (Nasdaq:STLD), Great Northern Iron Ore Proper (NYSE:GNI), Companhia Siderurgica Nacional (NYSE:SID) and Schnitzer Steel Industries (NASDAQ:SCHN), which closed mixed on Tuesday. And that's the more positive outlook by the majority of analysts. Many don't think growth will even happen at those modest levels.

A majority of steel companies are being forced to raise prices on their products in order to protect margins and earnings as the price of inputs and commodities rise.

That's not to say steel demand is falling, because it's not. But rising demand doesn't guarantee rising profits, as the industry is experiencing. A number of weak economies around the world could cut also into demand if steel prices and products rise to prohibitive levels.

Of course there a large varieties of companies with steel exposure, and each segment of the sector can represent strengths or weaknesses. So each unit and company will have to be watched closely for performance of course.

There's no way to spin the outlook for the steel industry in a positive manner. The industry will struggle for years even in the midst of strong demand as it attempts to work through the balance between steel demand, rising inputs, and ability for companies and countries to afford price increases from producers.

Some winners will emerge, but over time it's not easy to pick any one that's going to stand out. Some have looked to larger companies who may be able to navigate through the higher costs better, but we'll see if that's the case, as it isn't always that simple because of the wide variety of products and costs and pricing power with each one.

Schnitzer (SCHN) (STLD) (GNI) (SID) Close Mixed on Growth, Cost Concerns

The steel industry, even with some strong recent quarters, looks weak, as over the next five years it is expected to grow at a pace of about 5 percent or less annually, putting downward pressure on steel producers like Steel Dynamics Inc. (Nasdaq:STLD), Great Northern Iron Ore Proper (NYSE:GNI), Companhia Siderurgica Nacional (NYSE:SID) and Schnitzer Steel Industries (NASDAQ:SCHN), which closed mixed on Tuesday. And that's the more positive outlook by the majority of analysts. Many don't think growth will even happen at those modest levels.

A majority of steel companies are being forced to raise prices on their products in order to protect margins and earnings as the price of inputs and commodities rise.

That's not to say steel demand is falling, because it's not. But rising demand doesn't guarantee rising profits, as the industry is experiencing. A number of weak economies around the world could cut also into demand if steel prices and products rise to prohibitive levels.

Of course there a large varieties of companies with steel exposure, and each segment of the sector can represent strengths or weaknesses. So each unit and company will have to be watched closely for performance of course.

There's no way to spin the outlook for the steel industry in a positive manner. The industry will struggle for years even in the midst of strong demand as it attempts to work through the balance between steel demand, rising inputs, and ability for companies and countries to afford price increases from producers.

Some winners will emerge, but over time it's not easy to pick any one that's going to stand out. Some have looked to larger companies who may be able to navigate through the higher costs better, but we'll see if that's the case, as it isn't always that simple because of the wide variety of products and costs and pricing power with each one.

Steel Companies POSCO (PKX) (MT) (CRS) (SCHN) Get Boost from Consumption Report, (STLD)

Investors have suddenly become steel industry and company believers after the performance of Steel Dynamics, Inc. (Nasdaq:STLD) and the release of estimates for glow steel production by the World Steel Association, which pushed up the share price of ArcelorMittal (NYSE:MT), Carpenter Technology (NYSE:CRS), Schnitzer Steel Industries (NASDAQ:SCHN) and POSCO (NYSE:PKX) Wednesday.

Steel Dynamics gave as its reason for the optimism as growing backlogs in the company’s structural and rail division, but quietly added some of that could have been weather-related.

Also the projected global steel consumption growth of 5.9 percent didn't included the potential devastating effect the slowdown in Japan will have, as it's the largest consumer of steel in the world. Without that, the numbers are pretty meaningless. And it will take time, as with everything related to Japan at this time, before we know the full impact on steel and other sectors.

POSCO closed Wednesday at $113.23, gaining $2.73, or 2.47 percent. Schnitzer Steel Industries ended the day at $60.55, up $0.94, or 1.58 percent. Carpenter Technology closed at $44.05, jumping $0.85, or 1.97 percent. ArcelorMittal closed the session at $36.11, rising $1.15, or 3.29 percent.

Steel's (PKX) (NUE) (X) (AKS) Pressured on Low Growth Outlook

The steel industry is uninspiring as over the next five years it is expected to grow at a pace of 5 percent or less annually, putting downward pressure on steel producers like POSCO (NYSE:PKX), Nucor (NYSE:NUE), US Steel (NYSE:X) and AK Steel Holding Corporation (NYSE:AKS). And that's the more positive outlook from some analysts.

Many steel companies are being forced to increase prices on their products in order to protect margins and earnings, as the price of inputs and commodities continue to surge.

That's not to say steel demand is declining, because it's not. But rising demand doesn't guarantee rising profits, as the industry is finding out. Weak economies around the world could cut into demand if steel prices and products rise to prohibitive levels.

There's no way to spin this positively. The industry will struggle for years, even in the midst of strong demand as they try to figure out the balance between steel demand, rising inputs, and ability for companies and countries to afford price increases from them.

AK Steel Holding closed Friday at $15.78, falling $0.40, or 2.47 percent. US Steel closed at $52.80, down $0.91, or 1.69 percent. Nucor ended the session at $46.42, dropping $1.05, or 2.21 percent. Posco closed at $112.50, falling $0.05, or 0.04 percent.

Steel Firms (MT) (CRS) (SCHN) (STLD) Pressured on Low Growth Outlook

The steel industry is uninspiring as over the next five years it is expected to grow at a pace of 5 percent or less annually, putting downward pressure on steel producers like ArcelorMittal (NYSE:MT), Carpenter Technology (NYSE:CRS), Schnitzer Steel Industries (NASDAQ:SCHN) and Steel Dynamics (NASDAQ:STLD). And that's the more optimistic outlook by analysts.

Many steel companies are being forced to raise prices on their products in order to protect margins and earnings, as the price of inputs and commodities rise.

That's not to say steel demand is declining, because it's not. But rising demand doesn't guarantee rising profits, as the industry is finding out, and weak economies around the world could cut into demand if steel prices and products rise to prohibitive levels.

There's no way to spin this positively. The industry will struggle for years, even in the midst of strong demand as they try to figure out the balance between steel demand, rising inputs, and ability for companies and countries to afford price increases from producers.

Steel Dynamics closed Friday at $18.73, falling $0.47, or 2.45 percent. Schnitzer Steel Industries closed at $63.26, down $0.51, or 0.80 percent. Carpenter Technology ended the session at $41.97, dropping $0.47, or 1.11 percent. ArcelorMittal closed at $36.86, falling $0.04, or 0.11 percent.