Last week, Nucor dropped the price dramatically on some steel shapes. Now, we hear of some steel plants shutting down. See stories here and here. The stocks of steel companies continue to be hammered. And yet, notwithstanding, I have yet to hear about a single steel company going to the federal government looking for a handout. I think that is admirable. Hopefully, the wheels of the stimulus package aimed at construction and infrastructure will begin to turn a little faster soon. Then we will start seeing some real recovery.

Even though steel production was down in November, scrap iron prices actually went up in December. From the reports I have read, it appears US steel mills will take some additional time off here at the end of the year, which should push prouction down even further. Which leads to the question of what caused the upswing? Recycling Today didn’t have an answer – do you? Whatever the reason, here’s hoping that it is a trend that will continue, especially as the steel mills resume production in January.

In case you haven’t heard, scrap markets have essentially come to a standstill. While that shouldn’t be news to most of us, what may be is the latest forecast for recovery.  Steel mills have and continue to cut their production significantly which in turn reduces their need for scrap. This spiral downward continues to push back the expected date of reaching the bottom in scrap prices. Now, there is talk of no turn around in production levels until at least second quarter of 2009.

While this may seem to be all doom and gloom, there is a bright spot in the picture. Those companies that have prepared themselves for these times, are going to come out of it even stronger with much of the competition disappearing as cash flow comes to a screeching halt.

According to an article posted on the American Metal Market website, “five steel mills in Changshu city, in China’s Jiangsu province, have declared bankruptcy as a result of the current market downturn.” Just another sign that the current economic crisis in the US is being felt all over the world. The recession is real but it is up to each of us to decide if we are going to just accept it and let it roll over us or if we are going to find opportunity in it.

There will be many who choose to cut every possible cost so as to preserve cash and shore up profits. Those who do, will make the depth of the recession become a self-fulfilling prophecy for their firms. Those companies look to long-term results and work creatively and smart will find hidden opportunities to increase their market share.

What a cool, new technology. Recycling even the leftover dust! I assume they used to just dump that dust somewhere before this. Now, that cost is gone and Nucor is also provided additional material at a much lower cost. It’s no wonder they are already looking at additional plants across the country.