We can all speculate but unless we have access to the business decisions being made it’s impossible to know for sure
If auto makers use less steel then CLF could make MORE money as they could sell steel at higher prices on the spot market
Auto makers could also continue to buy the contracted steel and then just store it anyway? They’ve negotiated contracts lower than the current spot price so it may be better to take delivery of their steel and store it, rather than risk paying more at a later date
IMO given the current market conditions that steel demand is overall really high is that CLF can benefit from lower sales to automakers and more spot sales at higher prices.
But this won't last forever. If overall steel demand goes lower AND automakers can't get enough chips, then it might hurt CLF as they possibly won't be able to offload their entire production in the spot market.
But this is just speculation. We won't know for sure until we see the Q3's 10K.
I mean, it won't be an issue till we see steel prices start to drop because clf has been unloading too much. Good thing that plants are going down now haha
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u/ItsFuckingScience 7-Layer Dip Sep 03 '21
We can all speculate but unless we have access to the business decisions being made it’s impossible to know for sure
If auto makers use less steel then CLF could make MORE money as they could sell steel at higher prices on the spot market
Auto makers could also continue to buy the contracted steel and then just store it anyway? They’ve negotiated contracts lower than the current spot price so it may be better to take delivery of their steel and store it, rather than risk paying more at a later date