Steel stocks getting ready for lift off

by vitocorlene

I have been in the steel business for 25+ years – buying and selling US domestically produced and imported steel from over 30 countries. Over the past 8 weeks we have not seen steel prices surge like this since 2008.

www.google.com/amp/s/www.cnbc.com/amp/2020/12/11/chinas-iron-ore-prices-spike-10percent-to-a-record-high-on-supply-concerns.html

Supply concerns have spiked prices, but also, increased demand in finished goods – large appliances, construction materials – rebar, fasteners, steel beams, steel plate, etc

www.wsj.com/amp/articles/soaring-metals-prices-signal-bets-on-global-economic-recovery-11607250600

www.metalbulletin.com/Article/3966372/STEEL-SCRAP-WRAP-Prices-hit-highs-on-tight-global-supply.html

There is not relief in sight and many steel mills are having to purchase raw materials – iron ore and scrap at prices not seen since 2008.

That brings me to 3 🚀that will 🌙

MT – Arcelor Mittal

They are a dual benefit buy as they mine and produce – vertically integrated.

Their stock in June of 2008 stood at $297 – today it is $20. Facing a demand >>> supply situation not as great as we are at today.

I expect MT stock to increase by a minimum of 300-500% in very short order.

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This is for a trade only and not long time hold.

It will increase over the next 8-12 weeks and accelerate after earnings until supply catches up with demand and it will.

It did and the stock dropped to $78 by October 2008.

Im telling you this one is going to MOON.

I have common stock but also have a VERY SIGNIFICANT position in June 18 2021 $25c

I am going to retire on this.

Schnitzer Steel

www.schnitzersteel.com

Massive recycling play here – these are the guys that supply scrap for steel manufacturing to companies that are “mini-mill” Electric Arc Furnaces that melt steel scrap and make rebar and other steel products.

Scrap prices just increased here in the United States by $90/ton – the largest increase since 2008.

In May 2008 It was trading at over $100/share.

Today it is $29/share.

I have common and smaller option positions.

This too will skyrocket and then trade out in early summer.

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VALE

Vale like, MT is vertically integrated with mining and manufacturing.

May 2008 – $40/share

Today it is $16 share and on a blue sky trajectory – it will be $30 by March, maybe sooner.

Najarian is all over options on this one.

Google anything regarding “steel prices” and all you are going to see is exactly what I’m telling you – we are going to see all-time highs in steel prices next year and steel stocks are quickly going to move hot and fast.

MT – is my biggest play and I think you will see a lot more sector rotation out of tech and into materials betting further on stimulus and infrastructure spending.

 

Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.

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