NEW YORK Domestic flat-rolled producers have pushed steel buyers to book at higher offer levels since announcing a round of price increases in the past week, but the prospect of rising prices has done little to spur additional business, steel buyers said.
"Nobody is out buying extra steel," a Midwest distributor source told AMM. "(The increase) hasnt spurred any extra buying. People are hanging very tight and buying what they have to buy.
Steel buyers reported offers for hot-rolled sheet as high as $33.50 per hundredweight ($670 per ton), but the threat of rising prices following a recent round of hikes prompted few to book more material beyond what they need for immediate orders.
"Im not sure if they rattled the tree and a few apples fell. Im sure they did. But all of our suppliers honored pricing" established at the end of last week, a source at a northern distributor said.
"I have everything I really need. All Im doing is filling holes on some items," a source at a manufacturer said, noting that he booked hot-rolled material earlier this week at last weeks negotiated price and plans to buy only small tonnages as orders come up before the years end.
Steel buyers have noted that, among other factors, mill lead times have failed to extend, an indicator of the slow-to-increase demand that continues to hang over the market.
"Lead times, scrap and the year-end: There are too many things in neutral," the northern distributor source said, noting that he expects to see demand tick up as people look to increase inventories and book for specific projects in the new year.
Meanwhile, many sources agreed that the increases of varying amounts introduced by major producers late last week and this week will help shore up the previous hikes. The question has become one of when, rather than if, the increases will be realized, some sources said.
"I think the mills are trying hard to make the effort in pushing prices up," one trader said. "There seems to be less leakage (price deterioration) than before."
SteelBenchmarkers Dec. 10 report, published Wednesday, put hot-rolled band at $705 per tonne ($639 per net ton), up 1.7 percent from $693 per tonne ($628 per net ton) two weeks earlier (amm.com, Nov. 28) but still below offer levels of $33.50 per cwt.
SteelBenchmarker put cold-rolled coil at $818 per tonne ($742 per net ton), up 1.2 percent from $808 per tonne ($733 per net ton) two weeks ago.
Catherine Ngai, New York, contributed to this story.