Sheet depressed amid oversupply, flat orders

May 15, 2013 | 10:59 AM | Catherine Ngai

Tags  steel, steel prices, flat-rolled steel, steel coil, U.S. Steel, ArcelorMittal, Lake Erie Works, Indiana Harbor Works SteelBenchmarker

NEW YORK — The steel sheet spot market has dragged its feet this week as thin margins and short lead times continue to hinder pricing upside.

Mill and buyer sources have pointed in recent weeks to overcapacity as a top concern for the sheet market, particularly as a glut of material has discouraged would-be buyers from purchasing more than what they immediately need.

And with U.S. raw steel output at an average capability utilization rate of 78.5 percent last week, down 0.2 percent week on week but up significantly from 72.6 percent at the start of the year, sources say they see little change to the supply situation ahead.

"There’s overcapacity. But it’s not only in the U.S.; there’s global overcapacity issues, too," one Midwest service center source said.

Sources pointed out that recent supply disruptions have done little to change market fundamentals. Last month, Pittsburgh-based U.S. Steel Corp.’s Lake Erie Works in Nanticoke, Ontario, locked out some 1,000 unionized workers after the two parties failed to reach a labor agreement (, April 29). Chicago-based ArcelorMittal USA LLC also recently had a "technical" issue with the No. 7 blast furnace at its Indiana Harbor facility in East Chicago, Ind., which a spokeswoman confirmed has since returned to normal operations. ....

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