NEW YORK — Structural steel prices are moving up, but wide-flange beam buyers continued to order material this week at price levels seen before recently announced hikes.
"I’m still able to buy at the old price" of $745 per ton ($37.25 per hundredweight) on core sizes, one distributor said this week, citing short lead times that allow him to order material shipped by Nov. 30.
One reason transactions were continuing to take place at the previous price level rather than the new tag of $39 per cwt ($780 per ton) f.o.b. mill is what market sources described as an unusually large amount of floor stock being held by mills, although most buyers conceded that, as the end of November nears, they’ll be paying the higher price.
"I will pay the $39 (per cwt) as I need to," said a buyer for a large service center chain that’s in the midst of its traditional year-end inventory reduction. "I won’t put any more stock on the floor in 2012."
Last week, Nucor-Yamato Steel Co., Blytheville, Ark., and Nucor Corp.’s beam mill in Berkeley, S.C., announced hikes of $35 per ton effective Dec. 1. Tampa, Fla.-based Gerdau Long Steel North America followed, saying its $35-per-ton increase was effective "immediately" on new orders, although existing orders shipped before Dec. 1 would be "price-protected" (amm.com, Nov. 12).
However, it was unclear just how successful Gerdau has been in maintaining its policy of implementing price changes on an immediate basis in the face of other producers’ intention of not going up until next month’s shipments.
The remaining major domestic beam mill, the structural and rail division of Steel Dynamics Inc. (SDI), hasn’t changed prices on its website and hasn’t formally informed customers of a hike, according to market sources.
But buyers said they’ve been told informally by SDI representatives that the Columbia City, Ind., structural mill intends to increase prices along with the others. Moreover, beams due to be shipped by SDI after Nov. 30 have already been booked at the higher price, according to market reports.
A spokeswoman for the Fort Wayne, Ind.-based steelmaker declined to comment.