Six Year Trend Analysis on Steel Pricing and 10 Year History on AMM HRC Steel Sheet Index
The six year trend analysis on HRC reviews the 2004 and 2008 steel pricing bubbles.
The analysis for both the 6 year and the 10 year analysis show the cyclical price fluctuations that were based on quarterly supply and demand activity.
Steel price activity has been mainly influenced by recent scrap, iron ore coking coal prices due to the bad weather and flooding in Australia, but without an increase in demand these price increases will be short lived.
From an economic recovery view point we see upward trends in several areas including manufacturing but the residential and commercial building sectors are still struggling. I believe this struggle will continue to impact steel pricing well into 2012 and 2013.
Form the trend we see increases in steel pricing through Q1 and partial of Q2 2011 with a down turn in pricing as early as April.
The down turn may be delayed until May/June due to the flooding in Australia
Major Points on Steel Trends
HRC steel pricing follows a roller coaster pattern
There were two major price bubbles in the last six years (2004 & 2008) with increasing prices averages increasing after prices stabilized.
The steel contract lock-in strategy allows you to monitor the market trend and lock-in on the down turn of pricing.
The length of the contract depends on the market condition. If pricing forecast are trending down the contract will be shorter if pricing forecast are increasing the contracts will be longer.
Normal contract lengths are completed in quarters but depending on market condition the range can be one month to six months and in special cases 12 months.
Friday, January 21, 2011
Sunday, January 9, 2011
I just completed a six year trend analysis on HRC and outside of the 2004 and spring 2008 steel pricing bubbles the cyclical price fluctuations were based on quarterly supply and demand activity. I also see price increasing through Q1 and partial of Q2 2011. It’s obvious that steel price activity has been mainly influenced by recent scrap, iron ore coking coal prices, but without an increase in demand these price increases will be short lived. From an economic recovery view point we see upward trends in several areas including manufacturing but the residential and commercial building sectors are still struggling. I believe this struggle will continue to impact steel pricing well into 2012 and 2013. Joe Perillo
Monday, December 20, 2010
Lean Management Analyst Course at Penn State Abington
Lean Management Analyst Course at Penn State Abington 2011 Spring Semester. Visit http://www.abington.psu.edu/psasite/ce/ for more details
Lean Management Analyst
Lean principles offer tangible solutions to drastically cut waste, thereby improving quality, productivity and profitability. The fundamentals of Lean embrace the identification and elimination of waste throughout the entire supply chain, ultimately resulting in a more efficient business environment.
As a lean management analyst you will be able to help a company become more competitive, improve capacity and improve profitability by analyzing business processes utilizing lean enterprise principles.
This program teaches the fundamentals and techniques of Lean management, and facilitates the follow-up skills necessary to achieve successful results from the shop floor to the top floor.
Why You Should Take This Course:
• Add value to your resume! Knowing how to save a company money is a valued skill that will make a current or prospective employer take notice!
• Learn a skill that translates across all types of industries – from healthcare to manufacturing.
• Master the tools needed to market yourself as a problem solver. Be the person that can break through company “silos” and see the big picture!
Lean Management Analyst Course Schedule:
• Course Length: Seven Weeks One Night Per Week
• Dates: 2011 Spring Semester April 5th (no class 4/19) through May 24th
• Time: 6:00–9:00 p.m. Tuesday Nights
• Location: Penn State Abington Pennsylvania
• Fee: $495
• Credit: 2.1 CEU’s given
Lean Management Analyst
Lean principles offer tangible solutions to drastically cut waste, thereby improving quality, productivity and profitability. The fundamentals of Lean embrace the identification and elimination of waste throughout the entire supply chain, ultimately resulting in a more efficient business environment.
As a lean management analyst you will be able to help a company become more competitive, improve capacity and improve profitability by analyzing business processes utilizing lean enterprise principles.
This program teaches the fundamentals and techniques of Lean management, and facilitates the follow-up skills necessary to achieve successful results from the shop floor to the top floor.
Why You Should Take This Course:
• Add value to your resume! Knowing how to save a company money is a valued skill that will make a current or prospective employer take notice!
• Learn a skill that translates across all types of industries – from healthcare to manufacturing.
• Master the tools needed to market yourself as a problem solver. Be the person that can break through company “silos” and see the big picture!
Lean Management Analyst Course Schedule:
• Course Length: Seven Weeks One Night Per Week
• Dates: 2011 Spring Semester April 5th (no class 4/19) through May 24th
• Time: 6:00–9:00 p.m. Tuesday Nights
• Location: Penn State Abington Pennsylvania
• Fee: $495
• Credit: 2.1 CEU’s given
Wednesday, November 10, 2010
Lean Management Analyst
As a lean management analyst you will be able to help a company become more competitive, improve capacity and improve profitability by analyzing business processes utilizing lean enterprise principles.
The role of a lean management analyst will quickly be seen as the organizational problem solver. Most individual in this position eventually become operations leaders as well as other highly influential positions within the organization.
One of the most important tools of a lean management analyst is the process of value stream mapping. A value stream map outlines in detail every step of the process in its current state by documenting material and information flows. This allows the team to visually see the non value added waste within the process. Once the waste has been identified, action plans are established to reduce or eliminate the waste thus improving the efficiency of the process.
These are some of the improvements that can be achieved by applying lean principles:
• Increase product or service availability “Capacity”
• Reduce customer turnaround time
• Process simplification
• Cost reduction
• Improve safety
• Improve quality
• Reduce inventory levels
• Reduce logistics costs
• Reduce space
• Reduce lead Time
• Improve supplier performance and accountability
• Improve customer satisfaction and customer relationships
As a lean management analyst you will be able to help a company become more competitive, improve capacity and improve profitability by analyzing business processes utilizing lean enterprise principles.
The role of a lean management analyst will quickly be seen as the organizational problem solver. Most individual in this position eventually become operations leaders as well as other highly influential positions within the organization.
One of the most important tools of a lean management analyst is the process of value stream mapping. A value stream map outlines in detail every step of the process in its current state by documenting material and information flows. This allows the team to visually see the non value added waste within the process. Once the waste has been identified, action plans are established to reduce or eliminate the waste thus improving the efficiency of the process.
These are some of the improvements that can be achieved by applying lean principles:
• Increase product or service availability “Capacity”
• Reduce customer turnaround time
• Process simplification
• Cost reduction
• Improve safety
• Improve quality
• Reduce inventory levels
• Reduce logistics costs
• Reduce space
• Reduce lead Time
• Improve supplier performance and accountability
• Improve customer satisfaction and customer relationships
Sunday, October 31, 2010
Saturday, January 30, 2010
There was a recent post on the WSJ that suggested the Lean Manufaturing back fired at Toyota. "How Lean Manufacturing Can Backfire" Here is the link thhttp://online.wsj.com/article/SB10001424052748704343104575032910217257240.htmle
There is a saying in Christian circles “Christians are not perfect they are just forgiven” I believe the same applies to the originator of the Toyota production system or Lean Manufacturing. Toyota is not perfect but rather they are in pursuit of perfection.
I believe that the author of article was smart in picking the title knowing it would spark a discussion.
In any case lean did not cause the gas peddle to stick what we have is a process failure or a missing step. The basic principles of lean are the elimination of waste not the elimination of quality or safety. What might have been missed is the introduction of possible variation of failures that could have caused the problem. A lean six sigma approach would review the possible failure modes and work to reduce variation. From what I know of the failure it seems that corrosion is the return to idle mechanism caused the gas peddle to stick at the accelerated position. With this understanding we can learn to test for potential failures by exposing the components to multiple environmental conditions thus reducing potential failures.
Lean is also about learning and I am sure Toyota will learn a great deal from this problem that they can apply to future products.
There is a saying in Christian circles “Christians are not perfect they are just forgiven” I believe the same applies to the originator of the Toyota production system or Lean Manufacturing. Toyota is not perfect but rather they are in pursuit of perfection.
I believe that the author of article was smart in picking the title knowing it would spark a discussion.
In any case lean did not cause the gas peddle to stick what we have is a process failure or a missing step. The basic principles of lean are the elimination of waste not the elimination of quality or safety. What might have been missed is the introduction of possible variation of failures that could have caused the problem. A lean six sigma approach would review the possible failure modes and work to reduce variation. From what I know of the failure it seems that corrosion is the return to idle mechanism caused the gas peddle to stick at the accelerated position. With this understanding we can learn to test for potential failures by exposing the components to multiple environmental conditions thus reducing potential failures.
Lean is also about learning and I am sure Toyota will learn a great deal from this problem that they can apply to future products.
Friday, January 15, 2010
S&OP another Tool in the Lean Manufacturing Toolbox
S&OP another Tool in the Lean Manufacturing Toolbox
Lean is about continuous improvement, elimination of waste and sustainability by establishing process’ and standards. The S&OP process is a “lean tool” in the form of a process that will help reduce and control raw material & finished goods inventory, reduce or eliminate unnecessary overtime and reduce lead time. All of these factors, if not controlled or go unchecked will erode our bottom line.
The S&OP process is not a small side project it is a vital part of the business because it involves every aspect of our business, from Sales, Finance, HR, Manufacturing, Supply and Service and will chart the course of action for the organization.
Without a direct mandate from the President & CEO that this is not an option but a mandate that everyone involved is required to participate and contribute. If this is just an exercise or people feel they have the option to not contribute or get involved, it will die before you even start.
As an organization if we reflect back and ask ourselves how much more could we have added to the bottom line if we had managed our sales, labor and inventory better I believe organizations can add significant increases to the bottom line.
Lean is about continuous improvement, elimination of waste and sustainability by establishing process’ and standards. The S&OP process is a “lean tool” in the form of a process that will help reduce and control raw material & finished goods inventory, reduce or eliminate unnecessary overtime and reduce lead time. All of these factors, if not controlled or go unchecked will erode our bottom line.
The S&OP process is not a small side project it is a vital part of the business because it involves every aspect of our business, from Sales, Finance, HR, Manufacturing, Supply and Service and will chart the course of action for the organization.
Without a direct mandate from the President & CEO that this is not an option but a mandate that everyone involved is required to participate and contribute. If this is just an exercise or people feel they have the option to not contribute or get involved, it will die before you even start.
As an organization if we reflect back and ask ourselves how much more could we have added to the bottom line if we had managed our sales, labor and inventory better I believe organizations can add significant increases to the bottom line.
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