US mill pricing said leading to volatility

Oct 10, 2012 | 12:51 PM | Michael Cowden

Tags  steel prices, price volatility, Aldo Mazzaferro, Macquarie Capital, Jerry Nelson, RG Steel, Michael Cowden

ROSEMONT, Ill. — Higher prices for steel in the United States could serve to increase volatility and distract mills from the more important task of boosting capacity utilization, according to an analyst and a steel executive.

U.S. mills continue to price their steel at a premium to global levels, a practice that was sustainable when mill utilization rates were in the 90-percent range but not when they are hovering around 70 percent, said Aldo Mazzaferro, senior steel analyst at Macquarie Capital USA Inc. "When there is no domestic shortage, it is fairly risky to be tempting in new sources of supply with a wide pricing....

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