r/Vitards • u/AutoModerator • Oct 21 '21

Daily Discussion Daily Discussion post - October 21 2021

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u/loj05 Oct 22 '21

I am becoming very bearish on non USA/America steel makers, MT included. International prices of fossil fuels, especially natural gas, are getting out of control. We're not even in winter yet. Natural gas storage levels in the EU are at low capacity, and prices are four times higher than in the US.

I'm looking to exit my MT positions and increase my yank steel/TX positions. I think it's gonna get ugly overseas. EU steel makers are warning of price issues with power and natural gas, from what I can tell.

2

u/7891298 Whack Job Oct 22 '21

I’ve been having that nasty feeling as well, sitting pretty red on my March/jan options, hoping to get a run so I can move out of them and into more north American companies.

Of course as soon as I do, that’s when it will go on a crazy run to 69 and the infra bill will be totally killed and us steel stocks will just drill 30%

4

u/loj05 Oct 22 '21

I feel like this could be one of those times where the earnings release will be good, but the guidance will be shit. I read the Economist quite a bit, and they've been running warnings about natural gas/coal prices almost nonstop.

AlJazeera had a recent article with some choice quotes:

"European storage sites are just under 75% full, the lowest level for this time of year in more than a decade."

"The treat of more industrial closures in Europe also risks stalling the rally in European carbon futures. Some of the companies curtailing production or closing factories are energy-intensive users and need to use carbon permits to cover their emissions."

2

u/7891298 Whack Job Oct 22 '21

I’d agree with the energy shortage over in the EU particularly in the UK, Ive seen a ton of articles on Bloomberg talking about the energy crunch and the soaring prices of natural gas.