distributors steel shipments fell 3.5 percent on a
per-day basis in November compared with a month earlier, but
market players say some of that weakness has abated in December
as buyers who reduced inventory too sharply ahead of the
holidays were forced to re-enter the market for tons.
Last month, U.S. steel shipments
totaled 3.09 million tons, according to Metals Service Center
Institute data, a nearly 12-percent decline from October and
6.4 percent lower year on year. On a per-day basis, U.S.
shipments totaled 147,200 tons, down from 152,600 tons per day
during the previous month.
Canadian shipments totaled
495,100 tons in November, down 5.4 percent from 523,400 tons in
October, with per-day steel shipments dropping to 23,600 tons
from 23,800 tons in the same comparison.
Meanwhile, U.S. inventories rose
to 2.6 months supply from 2.4 months worth in
October, and Canadian stocks rose to 3.4 months supply
from 3.2 months worth previously.
While November proved to be a
weaker month for steel service centers in North America,
December has so far shown some welcome resilience, sources
"Some markets are a little
better for demand, like western Canada. And our automotive
numbers held up well. Our overall business book is pretty
consistent," a multibranch service center operator said. "Our
December per-day shipments, until last Friday, were running
ahead of November," but the holidays will break that pace.
A lower Great Lakes master
distributor agreed that December volumes have been better than
"December shipping rates are
pretty good and our backlog into January is fine," he said,
citing strength in a number of end use segments. "Automotive is
still humming along. We dont sell direct but we sold
automotive-grade steels, filtering from our service center
customers to stampers and Tier II and III suppliers."
Some of that renewed December
demand might be coming from customers who reduced inventory too
fast and are being forced to come back in for material, sources
"Some also delayed orders from
November and are now spurred to action by announced price
increases," a Chicago-area coil processor said.
On the sheet side, mills have
announced three rounds of price increases in the fourth
quarter: a $40-per-ton hike in October, a $50-per-ton hike in
November and a $20- to $30-per-ton increase in December,
depending on the mill. Most mills have only captured a portion
of the cumulative increases, sources confirmed.
"Of the $120-a-ton total,
weve probably seen (increases of) $30 to $40 per ton,"
the multibranch service center operator said, citing hot-rolled
pricing in the $640-per-ton range, rather than the $700-per-ton
level or more that would have been achieved if all the
increases took hold in full.
Other buyers confirmed most
mills were still selling below published prices.
A Mississippi Valley
distributor, for example, said the published quote on
galvanized coil is $750 per ton but hes getting it for
$640. Mills kept rolling substrate in spite of slim orders and
are now trying to get rid of it, he said, noting that one mill
is shipping his coated coil order in only 13 days.
"Maybe those deals are cooked
and no longer available," he said, but "Im swimming in a
big ocean and Im not the shark," so competitors must have
received similar transactions.
Nonetheless, prices could gain
some more ground in the new year, buyers said. While many
steelmakers melting and rolling schedules havent
yet filled up for January because service centers "dont
want to pay the new price ... they will have to place an order
eventually," the Chicago-area coil processor said.