Arcelor to move away from CRU-based pricing

Apr 16, 2013 | 06:29 PM | Jo Isenberg-O’Loughlin

Tags  ArcelorMittal USA, CRU Group, CRU Steel Price Index, steel, Jo Isenberg-O'Loughlin, Corinna Petry

NEW YORK — Mounting frustration with the CRU-minus-discount approach to flat-rolled steel pricing and what many U.S. mills perceive as the practice’s erosive effect on sales margins erupted in full force April 16 when the commercial leadership of ArcelorMittal USA LLC told the company’s sales team that it will no longer enter into any new agreements based on a discounted CRU.

“We believe this pricing mechanism has become more prevalent and is causing an unnatural ceiling price, and therefore is undermining our ability to collect a fair market value for our products,” the leadership said in an advisory seen by AMM. The Chicago-based steelmaker went on to say that for the balance of 2013, it will offer firm price agreements for monthly, quarterly and six-month durations that “assume volume and price is sustainable for all parties.”  ....

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