NEW YORK The U.S. steel
import market has hit a flat spot in recent weeks, driven by a
lack of decent sales, domestic overcapacity and pessimism
globally, market sources told AMM.
"Everyone is in a bad mood.
Its making it difficult to stay upbeat and difficult to
stay aggressive," one trader said. "Its kind of confusing
statistically, too, because manufacturing is supposed to have
picked up a bit. Its not the end of the world, but
clearly weve hit a flat spot."
Hot-rolled sheet imports are in
a range of $645 to $660 per ton at the Port of Houston while
cold-rolled sheet is between $740 and $780, traders and buyers
said. In comparison, domestic Midwest hot-rolled prices are
around $675 per ton ($33.75 per hundredweight) and domestic
Midwest cold-rolled is about $780 per ton ($39 per cwt).
With imported prices only
marginally lower than domestic material, buyers are hesitant
about booking foreign orders.
"No one is buying. If you look
at the fourth quarter, it was extraordinary for everyone. In
the first quarter, it carried over a little. Then we hit the
wall," one buyer said. "Foreign offers arent coming in
here that cheap. And if someone offers me something for late
August-September delivery, Im not sure I can risk
The U.S. manufacturing sector
expanded in April at its strongest pace since last June,
according to the Institute for Supply Management. However,
traders and buyers said they have yet to see that translate
directly to their business.
In fact, April steel import
license applications hit their highest number in more than a
year, according to Commerce Department data released Wednesday
(AMM, May 3). The gains, led by plate in coil from
Russia and hot-rolled sheet from South Korea, likely were from
orders placed in the late fourth quarter and early 2012.
Meanwhile, traders said
theyre waiting for lower offer prices from offshore
mills, including those in China, Turkey and Eastern Europe. The
current lack of lower-priced imports, combined with sliding
domestic prices, has left traders unable to sell without making
"Weve seen a bit of a
slowdown for the most part. Everyone is being more cautious
than usual going into the summer, and prices are a
. . . touch on the drop," a second trader said.
"Its not too terrible, and manufacturing results that
came out recently were quite positive. Were waiting to
hear from Turkey right now."
On the international front,
market sources said that frustration with slow-moving economies
in Europe and Asia has caused concern moving forward. "Im
pessimistic about Europe right now," a second trader said. "I
dont see that coming out of the tunnel, especially with
issues over there."
Others agreed, adding that
conditions must improve worldwide before fundamental change can
"I dont want to be
pessimistic, but things look bad out therein Asia, in
Europe and here. The spot market is bad, and I know a lot of
people who have inventory on the ground and theres no
action," a third trader said. "No one is asking for anything
and no one wants to buy. Theres just too much steel. If
you have stuff on the ground and you cant even match the
low-priced domestics, you cant win. Its been very