Steel Sheet Price Increases In US Garner Mostly Positive Reaction
26 October 2016
Price increases of $30/st announced by the majority of US flat-rolled sheet steel producers at the end of last week and on Monday have received generally positive feedback, sources said Tuesday. However, most were still trying to decipher the new price levels.
A buyer said the increase had been going over "pretty well" so far. He added the most important thing to watch over the next week or two will be if lead times start to push out.
Lead times are how buyers "get caught short," he said, if some are managing purchases based off a two- or three-week, hot-rolled coil lead time and then it is pushed out to four or more weeks. Mini-mills would likely benefit from this scenario if they can charge higher prices for expedited orders, he added.
The buyer said US Steel's new target minimum base price was heard to be $510/st for HRC following the $30/st announced increase. He anticipated mini-mills would likely remain just under the $500/st mark for HRC during the initial phases of the increase.
A service center source was trying to figure out where prices were now at following the $30/st increase. He confirmed the buy-side source's prediction on mini-mill prices.
A Midwest mini-mill quoted the service center source $490/st for a HRC inquiry. However, the service center source said he had been quoted $480/st from the mill in the middle of last week.
Prior to the increases last week, multiple buy-side sources noted competing mini-mills in the region at $460/st levels for small-volume HRC orders.
A second buy-side source was still weighing his purchasing plans through the remainder of the year following the announcements. He was skeptical the announcements would result in much of a bump for transaction prices, but was confident that they would not fall any lower.
Due to a lack of firm offers or new transactions, S&P Global Platts maintained its daily HRC and cold-rolled coil assessments at $460-$480/st and $690-$700/st, respectively. Both prices are normalized to a Midwest (Indiana) ex-works basis.
Source : platts.com