While steel prices soared in China this summer, U.S. steel prices were flat in August as the market remained in hiatus, awaiting further trade action from the U.S. government on unfair steel imports.
There was a great deal of hope that the Section 232 investigation into steel imports would give U.S. steelmakers another boost after the 2016 U.S. steel stock rally fizzled in 2017, but the self-imposed July 1 deadline for the investigation’s results came and went – and now the steel prices in the U.S. are treading water with the weak fourth quarter just around the corner.
The Commerce Department has until January to release its findings, and given the delay, it may very well take all of its allowed time. If that is the case, U.S. steel prices could see even more weakness.
In company news, Thyssenkrupp may reach a principle agreement this month to merge its European steel business with Tata Steel, with the company saying that talks have been “constructive” and are entering the final stretch, according to Yahoo Finance.
If these talks continue to progress the companies will ink a memorandum of understanding, which will pave the way for each company to take a more detailed look at the other’s books. This news comes following progress on a major hurdle to the combination. On Monday, the final separation of the British Steel Pension Scheme (BSPS) from Tata Steel UK, occurred. This frees Tata Steel UK and its affiliate companies from 15 billion pounds of pension liabilities and increases the prospects for Tata’s merger with ThyssenKrupp.