Please give me some good news

After all, since last writing on the steel supply outlook, as I see it for our customers, you and I have seen the Chancellor Kwasi Kwarteng, resign on October 14^th, followed by Prime Minister Liz Truss, after the most expensive mini budget, costing the UK £30bn.

Now back to some level of normality, as Rishi Sunak has taken over as PM along with a more circumspect Chancellor. The delivery of his budget many believe has at least plugged some of the holes, even if there is much more to come and uncertainty ahead.

Liberty Steel have dodged the bullet of compulsory winding up with a debt restructuring deal. Some may say this is not right, but we need to keep our minimal steel production as high as possible, so whatever the rights and wrongs, Liberty Steels continuance is positive for UK Steel output.

So, after this hurricane, added to the uncertainty and volatility we were already experiencing I could reasonably ask is there some good news?

Well first there’s a little more fall out from this, here is a quick fire!

Change – the pound has fallen in value, so we have a weaker exchange rate.

Challenge – the cost of buying material just went up; including steel as well as many other products of course. Getting them from Ports many of which remain congested, is an ongoing challenge.

Change – none, no halting by Russia as the war against the Ukraine continues.

Challenge – energy costs continue to be high, meaning transport, production and power costs remains high too.

I promised some good news so here goes >

1. High Peak Steel have, in stock, most materials you regularly buy, so don’t be shy I’m here to help.
2. Easy Stock search – we’ve upgraded our search so now you can search by material type, as well as the grade. Enquiry for the grade is also now improved. Visit our Carbon Steel page and search for Black round, it’s so quick to find your grade.
3. Manufacturers start exporting – most of our clients make things, so have a think about what you make and see if you can export it.
4. Shipping costs – the cost of shipping a 40-foot (ft) container from China to the US West Coast has dropped by 84% since the start of April to $2,470 (£2,154). According to the Freightos Baltic Index, with a weaker pound the price overseas customer will pay has fallen, making you and possibly your export customers more competitive. Ok, it does not take all the price hike away, but it is a silver lining in an otherwise dark.
5. Lobbying MP over Quota Restrictions – Robert Largan, Member of Parliament for the High Peak has updated me today that following on our letter to Parliament there is now openness to explore some of the challenges we face in the steel market.

In conclusion I believe that you like I have to look for where there are opportunities, whilst not ignoring all that is going on myself and my team at High Peak Steels remain positive.

Only this week we have invested in some green technology, adding to our solar panels with an upgrade, including a power battery wall in one of our storage locations to store some of that precious energy.

In 2023, we’ll be looking to new opportunities, more on that next time.

I wish you well and I am always happy to hear from customers, regarding something written, or about the steel we stock.

Regards,
Mark Thornley
Managing Director, High Peak Steels Ltd