SBQ buyers gear for $90/T hike in Jan.

Dec 10, 2010 | 12:55 PM | Corinna Petry

Hot-rolled and cold-finished steel bar product buyers are preparing for higher prices come January, with many buyer sources agreeing that a $40-per-ton base price increase and a $50-per-ton raw materials surcharge hike scheduled to take effect Jan. 1 likely will be accepted and passed down the supply chain.

Steel bar manufacturing capacity is so tight that most buyers confirmed that lead times on certain grades and sizes are now out to 50 weeks, and there is a strong likelihood that other mills—namely Republic Engineered Products Inc. and Gerdau Macsteel—might follow Timken Co.'s lead in putting customers on allocation (AMM, Nov. 15). Many commodity grades from other North American producers do have lower lead times of 14 to 18 weeks, sources told AMM.

Nucor Corp. issued raw materials surcharge letters this past week on special bar quality (SBQ), with the surcharge up $2.50 per hundredweight to $13.50 per cwt ($270 per ton) based on AMM's Chicago consumer buying price of $440 per ton for No. 1 busheling. Nucor's surcharge was unchanged in November and December at $11 per cwt.....