LOS ANGELES Flat-rolled steel prices are moving up on the West Coast, but a number of buyers remain hesitant.
The latest domestic hot-rolled coil prices in the market are estimated at $34 to $35 per hundredweight ($680 to $700 per ton), approximately $1.75 to $2.25 per cwt above what many buyers were paying before the latest series of price-hike attempts began.
California Steel Industries Inc. (CSI), Fontana, Calif., notified customers last week it had already closed its order books for January, market sources said. CSI said it would raise hot-rolled, cold-rolled and galvanized steel prices by at least $40 per ton in mid-October, while the regions other major flat-rolled producer, Pittsburg, Calif.-based USS-Posco Industries Inc., slated hikes on cold-rolled and galvanized steel on the same date (amm.com, Oct. 18
These increases were partially successful though some several buyers told
AMM that they were initially able to line up material at the previous lower prices. The two producers subsequently boosted prices on a case-by-case basis, market sources said.
While higher prices appear to be taking hold, a substantial number of buyers, looking at short mill lead times and concerned about the likely state of demand in the first quarter, say that theres little reason to make tonnage commitments beyond their absolute minimum requirements.
Im paying more than in November and December, but Im not buying very much, a large distributor said. He was able to line up of most his requirements for the balance of 2012 at pre-increase levels. But like most buyers in the area, hes not yet ready to make serious commitments.
Chinese cold-rolled coil is one product for which the price differential between imports and domestics has lately narrowed. About two months ago, it hit a low of approximately $32 per cwt ($660 per ton) base, ex-dock, but with recent quotes to the trade, prices are now reported in the range of $34 per cwt ($680 per ton). Prices for domestic product have increased by a lesser amount.
This development trims the price difference to around $80 per ton from an earlier $120 or more, while forcing buyers to speculate on the markets level in April, when the material is due to arrive.
"Theres no way I can make a bet on that," said a buyer of the Chinese cold-rolled offer.