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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (75460)	4/19/2001 10:27:28 AM
From: Haim R. Branisteanu	Read Replies (1) \| Respond to of 99985

Not only High Tech in recession .......... private e-mail to me today from a veteran real life metal trader. e-mail address erased for obvious reasons Date: Thu, 19 Apr 2001 10:06:33 -0400 From: Jeffrey To: haim branisteanu <hbranisteanu@nyc.rr.com> haim How are you ? Good to see you in print. Haven't lost your guru touch ! You old bear you ! Speaking about inventories, you should see the over capacity in the aluminium sector. The industry has cut back to 80% capacity due to everything from energy costs to lack of cars sales to antiquated equipment... These are the times when this industry retools and uses up old inventory and ships all they got on hand while laying off workers in order to survive with the hope that the future will sustain them. What a mess ! I don't know if I have told you but I have been trying to place alloys here and man is it rough going. Plant shutdowns, consolidation, long term contracts...13 and 10 years (Imco and Alcan) and this is just two (large) players in the secondary (regardless of volatility in the scrap segment) and primary sectors. Never mind what Alcoa and Wabash are doing. Yuck ! Not even room for my little shipments. These guys are operating close to the bone, let me tell you. But prospects are good as the amount of aluminium in each car produced in N America will go from 250 lbs to 350 lbs. before 2005. 4 years away ! Room for everybody ? Hopefully. But what happens to the margins in the meantime ? Apologies for my discourse but it lends credence to your views that inventories are being run down or written off and Fed actions have little effect on the real deal...survival of industry at current employment/output levels and the ability of the markets to absorb all the goods. Just keep on buying cars I say ! Anyway, good to hear you and keep up the insight. All the best. jeffrey