Steel Market Update’s 2017 Steel Summit kicked off in Atlanta this week and the topic on everyone’s minds was Hurricane Harvey and the far-reaching impact it will have on the Houston region.
The humanitarian impact of Harvey cannot be overstated, but the economic impact on Houston, an industrial hub in the southern United States, will be felt in both the short- and long-term, with freight transportation at a virtual standstill (Port Houston operations resumed today, according to an alert on the Port Houston website).
According to SMU, FTR Transportation Intelligence reports up to 10% of U.S. truck capacity will be disrupted in the next two weeks.
“Look for spot prices to jump over the next several weeks with very strong effects in Texas and the South Central region, Noel Perry, partner at FTR, told SMU. “Spot pricing was already up strong, in double-digit territory. Market participants could easily add 5 percentage points to those numbers.”
Gas Prices Surge
In response to fuel supply disruptions from Hurricane Harvey, average national gasoline prices grew to $2.37 per gallon earlier this week, and continued to surge to $2.51 Friday morning, according to the AAA website.
“It’s still really early to tell what this is going to mean for long-term supply,” Denton Cinquegrana, chief oil analyst at Oil Price Information Service, told SMU. “If some of these refineries are flooded, it’s going to take weeks to get the water out of there and then get into damage assessment.”
How will steel and base metals fare in 2017? You can find a more in-depth steel price forecast and outlook in our brand-new Monthly Metal Buying Outlook report.
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