Severstal, Nucor join in push to halt discounts

Apr 18, 2013 | 04:12 PM | Catherine Ngai

Tags  steel prices, CRU, discounted index prices, Severstal, ArcelorMittal, Nucor, flat-rolled steel, hot-rolled steel Galvanized steel

NEW YORK — Just days after ArcelorMittal USA LLC’s announcement that it would no longer accept new agreements based on a discounted CRU index price, a number of major domestic sheet mills have jumped on board in a commitment to halt erosion of already thin margins.

Dearborn, Mich.-based Severstal North America Inc. told customers in a letter dated April 17 that in addition to raising minimum prices to $32 per hundredweight ($640 per ton) for hot-rolled coil and $37 per cwt ($740 per ton) for cold-rolled and galvanized steel, it would no longer sell steel against a discounted CRU index price.

"Over the past few months, Severstal has been reviewing current pricing methods, including their effect on our customers," Tom Marchak, Severstal’s vice president of commercial, said in the letter. "We have found that discounts off a CRU indexed price do not always reflect market conditions."....

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