Steel Bulletin February 2016

Prices

Prices, since our last steel bulletin in October, have again eased downwards but a combination of scrap and iron ore prices unable to go too much lower and the weakening of sterling against the euro and US dollar has put the brake on further falls. Uncertainty surrounding the future of Longs Steels (part of Tata) and relatively strong UK demand for structural steels has in fact sparked an increase in merchant bar and heavy section prices. Prices are certainly not going down in the short term and we are being asked for price increases of up to £30/t. For up to date information please give us a call on 01845 528200.

Supply

There are no specific shortages at present, however there is uncertainty surrounding the future of several UK mills. Longs Steels (part of Tata Scunthorpe) is in the process of being sold and their future is closely tied to that of CMB and of course Tata Distribution is also part of Longs Steels. The next few months should provide much needed clarity and, although we are net importers of steel as a group, we sincerely hope that Longs Steels and Tata survive as the UK will be a poorer place without our own steelmaking facilities.

Tomrods Ltd

Despite falling prices we have managed to stay in the black up to our year end in December. 2015 will be remembered as the year the economic text books had to be rewritten as strong demand should lead to rising prices not leading to prices falling by up to a quarter over the year. We have survived the storm which was 2015 and we are fit and well ready to face 2016. On the personnel front we now have 51 employees, we have said goodbye to Keith McKee who retired last May, although we are delighted that he has agreed to come back on a consultancy basis looking after certain accounts on a part time basis. In his place we are again delighted to welcome Neil Latcham to our Board of Directors and he will be our new Sales Director. During 2015 we congratulated Eddie Plumpton on 30 years’ service and Frank Metcalfe on 25 years, and during 2016 Melinda Bruce and Mark Cowgill complete their own 25 years.

2015 saw tonnes sold by Tomrods increase over 2014, but only just, to 28,556 tonnes and group sales increased by 3.6% to 143,477 tonnes. 2016 has started well, the new crane in warehouse B will enable our new night shift to work unimpeded and we intend putting something back into our community by running in the Great Knaresborough Bed Race and raising lots of money for charity. Finally I would like to thank all our customers for the continued support throughout 2015 and we continue to work hard towards being the best steel stockholder and service centre in the UK.

Thank you for reading this and if you have any comments about Tomrods Ltd or our website please e-mail the undersigned at johnt@tomrods.co.uk.

John Thompson

MANAGING DIRECTOR