Houston Service Centers Scrambled to Unload Extra 2014 Inventory
At the end of 2014, steel service centers located in the Houston area scurried to unload the rest of their inventories to avoid facing year-end taxes, however a surplus of steel at the Port of Houston resulted in an oversupplied market. This flood can be attributed to a 40% increase in steel at the Port of Houston – the United States largest entry port for imported steel – in just the first eight months of 2014 alone.
“There’s more steel in Houston than we’ve seen in the last eight years,” said one local buyer who blames the flooded market on Russian producers of steel. “Due to the turmoil in Ukraine, they [Russian producers] sent as much as they could in case there was some kind of ramification. You can technically buy coil from a service center cheaper than from a mill.”
Those who do have steel waiting at the docks were having some trouble getting their products to them. Inventory continued to pile up at the Port of Houston due to a lack of available trucks to deliver the steel to customers. The urgency to get the steel to customers was easily apparent and resulted in Houston service center offering tonnage of hot rolled coil at greatly reduced prices.