In Commodity News 04/05/2015
Enthusiasm for the recently announced US sheet steel price hikes seems to be high, but their ultimate success will depend on how much support they get from the buying community, market sources said.
“It sends a message that there’s not a whole lot to give now,” one service center executive said. “I think we just have to wait and see and watch the lead times.”
Another service center executive said his team has heard from two separate mills that another increase may be on its way in the next 30-45 days, depending on this round’s success.
For the increase to succeed, he said, service centers need to up their prices to end-users and limit the quantities they liquidate at discounted prices from their inventories.
“If someone has it on the floor, or they’ve got import, they’re going to do whatever they have to do to sell the steel,” he said. “[And] there’s a lot of guys with a lot of tons on the floor.”
Another buyer said pricing at the mill level remains “sloppy,” but it should firm up within a week.
He added that $460-$470/st hot-rolled coil offers seem to be the norm at the moment, and buyers have to seek out offers as opposed to the mills soliciting them.
Platts held its assessment Thursday at $440-$450/st for hot-rolled and $570-$590/st for cold-rolled. All prices are normalized to a Midwest (Indiana) ex-works basis.
