Mills strict in nixing index-based discounts
Oct 23, 2013 | 05:32 PM
| Catherine Ngai
NEW YORK U.S. steelmakers are said to have remained firm on a pledge to move away from index-based discounting as intensified negotiations are under way in the sheet market.
Beginning in the late summer, U.S. mills and buyers kicked off contract negotiations for 2014, with a large number of flat-rolled steel contracts expiring at year-end. In recent years, the rise and spread of "CRU-minus" deals, using a specific CRU Group-indexed price minus a certain percentage, has led to a practice that mills claim is eroding sales margins.
But mills are said to have kept to their word, with the majority refusing to offer index-based discounts and a number of options reportedly have been put on the table, according to more than a dozen market sources, including a number of mill executives, service center buyers, manufacturers and traders.....
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