walker, you are missing my point here. It is not the illegals causing your problem, it is all the insurance and tax overhead that is driving your wages lower. Yes you are making $15 an hour, but with the overhead, the company is paying over $30 an hour. Been in business for myself over the last 25 years and this percentage is constantly growing. Start your own business installing cabinets and you will keep more of what you earn, some of it illegally because if you play by the rules, you will make about $15 an hour. Take your battle to the real problems, like Obamacare.
$10 an hour? I can't get a laborer for anything less than $18 and at that price I don't ask if they are legal or not. The legal white guy wants $25 an hour. But yet if I am out looking for a job, then they all want to pay $15 an hour for a skilled carpenter. This world is upside down and the problem is the added cost of labor that comes from employer taxes, healthcare, insurances and all the overhead associated with employing people. Just the liability insurance it takes to cover an employee is enough to break the bank.
And here is where the South has the advantage, they limit liability to the actual cost to repair, no extra for legal fees, attorney cost, pain and suffering... not at all like the northern states or the West Coast. You attack illegals, yet the real problem is the added cost of all the legislated requirements.
CLF will never export pellets to China or India... they need to export the technology and logistics and collect management fees from the Chinese and Indians.
Careful, all of this is going to change. Right to Work is bringing auto and aircraft manufacturing to the South. High taxes is causing people to move from the North to the South. Widening of the Panama Canal will make Charleston the main port on the East Coast. Southern colleges are some of the best in the world, if I had something serious wrong with my health, my first choice would be Duke Medical. The only thing that will stop the South from taking over is the liberals moving to the South from the North!
In a low cost iron ore environment, integrated steel companies don't make sense mainly because they have trouble selling ore to other steel companies as companies don't want to add to the profit of their competitors.
AISI reported import numbers for Jan, they are up 2% from December to 25% of steel sales in the US. The following is the top importers:
"In January, the largest finished steel import permit applications for offshore countries were for Turkey (262,000 NT, up 56% from December preliminary), South Korea (259,000 NT up 10%), Japan (216,000 NT, up 50%), Germany (125,000, up 3%) and Brazil (89,000 NT, up 30%)."
Notice China did not make the top 5. Also, Turkey continues to be the top importer!
Looking at the volume in the last 15 minutes, looks like some shorts have started to cover. Up 22% is a good day, but I really would like to see volume return to 8 million shares a day. Maybe tomorrow! Have a good evening, back to work on the shower....
Just taking a break from laying tile, CLF is up big as materials have finally reversed their downturn (according to CNBC). Volume does not indicate short covering, maybe in the last 15 minutes and tomorrow.
Also, because of the cost to produce pellets is fairly constant from region to region, advantage goes to the local suppliers as the cost of transportation keeps outside sources at bay. CLF does not have to worry about Chinese iron ore pellets being imported to the US.
And this is why CLF needs to help China to develop their domestic pellet production to support their steel manufacturing. Bring in cash to CLF and stick it to the big 3 iron ore producers.
Essar is borrowing money to finance the CCAA process and is rapidly running through the cash with no other options but to liquidate to insure the people financing this process will get paid. If Essar has to shut down operations, then the game is over for them without cash from continuing operations. Whereas CLF is totally financing the CCAA and with it coming to an end, CLF is first in line to be repaid for the money they lent.
I try to just give you the latest news from the sources I monitor. But since you asked, my thought is that worldwide demand for steel is down and the US grants permits to import steel based on this demand. It is a process that is slow to react and is the reason we saw such a high percentage of imports at the beginning of the year then to see it fall by 10%. CLF and others are down because of worldwide demand and if you watch the import data and US steel production provided by AISI on a weekly basis, you can catch some insight where prices are headed. So far I see a bottom forming and finally indications of a turn around, but we really need some type of infrastructure build by a major economy to put this recovery on the fast track.
"Full Year 2015 total and finished steel imports were 38,718,000 and 31,425,000 net tons (NT), respectively, down 13% and 7% respectively, vs. 2014. Finished steel import market share was an estimated 26% in December and is estimated at 29% for the full year."
The US should not be importing 29%! In 2015 the US imported 34% to 32% in the first 4 months and currently running at 26%. Hopefully 26% is the high water mark this year.
If you low cost producers are at $20 for fine iron ore, then their cost to pelletize that ore would be $30 more to put their low cost at $50. So yes, CLF's iron ore pellet cost of $45 is lower!
Here is the problem, LG uses CC and press releases, CEO's like Musk, Schultz and many others use main stream media to launch an offensive move. How can someone like Trump be the front runner, he is a master of the media. The guy got more media coverage by not being on the debate than if he would have attended.
However, LG is very shrewd. All of his moves could be by design.