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W. Coast steel plate deals slow on buyer fears

Keywords: Tags  steel, carbon plate, west coast, Evraz NA, Frank Haflich

LOS ANGELES — Carbon steel plate sales on the West Coast appear to be slowing further as few buyers appear willing to gamble that even today’s low prices will look good in a month’s time.

"We’re only buying per job, otherwise not until next year," one distributor source said.

Domestic prices for warehouse grades and sizes, which last month were as low as $830 to $840 per ton ($41.50 to $42 per hundredweight) delivered, are now moving lower, approaching $40 per cwt in some cases, depending on delivery costs, according to sources.

With the market’s current direction and sentiment, including the impact of heavy import inventories, buyers remain cautious.

"You don’t want to be paying over $40 (per cwt) for plate if you want your inventory costs to remain competitive," one service center executive said.

Interest in purchasing plate, which earlier in 2012 was viewed as the strongest of the major carbon steel products in the West Coast market, has fallen to what most buyers agree is the year’s low point.

"At the current consumption level, we think it’s probably going to take until the end of the year to work off inventories," another buyer said.

Among the major domestic sources for carbon plate in the West Coast market are Nucor Corp.’s facilities in Hertford, N.C., and Tuscaloosa, Ala.; the North American division of Lisle, Ill.-based SSAB Americas; and Chicago-based ArcelorMittal USA.

Moreover, the region’s only significant producer of discrete plate—the Portland, Ore., operations of Evraz North America Inc.’s Flat Products Group—has become more active in the trade plate market, sources said. It is competing against large distributors, who at times play the role of mill depots, while also offering relatively short lead times.

An Evraz spokeswoman couldn’t be reached for comment Wednesday.

Meanwhile, the role of South Korea—the benchmark for imports in the West Coast market and believed to account for most foreign plate in the region’s warehouses—remains unclear. While some sources said the latest offers from Korea have fallen below $37 per cwt ($740 per ton), others said they haven’t followed up on these reports because their warehouses are already full.

"We told them we don’t need any more plate," one buyer said of his recent contact with traders selling Korean plate.

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