NEW YORK — Concerns continue to hang over the steel plate market over whether price increases announced by domestic mills will hold in the new year, and sources say that there will be little to support the higher offer levels without the usual seasonal uptick in demand come the new year.
"Some of the pricing (increase) has stuck, (but) there’s a certain amount of hesitation as to whether it will stay that way and whether it will hold," one distributor told AMM.
Domestic mills have offered steel plate products at higher levels for January delivery, but many spot buyers said they have only been buying what they need in the meantime.
"Demand has remained fairly flat, and the mills’ pricing is what it is," a second service center source said, noting that he hasn’t booked at the higher prices that domestic mills have been quoting because he can’t yet translate that price increase to his customers.
Domestic mills are said to be quoting offers as high as $39 per hundredweight ($780 per ton) for discrete carbon plate in certain regions east of the Rockies, but due to limited buying activity the average price of carbon-grade discrete plate has stabilized over the past two weeks at $37 per cwt ($740 per ton) f.o.b. Midwest mill. That represents about $60 per ton of the total $100-per-ton increase in published prices that domestic plate mills have tried to introduce after making two announcements in November.
Fundamental demand might not be there to support such increases, sources said. Lead times—seen as an indicator of demand—remain short, with material both readily available from mills’ inventories and depots and production at many mills not yet pushed out through the end of January.
"There’s nothing out there encouraging as far as demand goes to warrant buying anything more than you need," one service center source in the South said.
Many consumers are buying only on an as-needed basis.
"Last week there was some activity, but this week, as we get closer to the holidays, it’s pretty dead," one mill source said.
Whether the plate market will see a seasonal pickup come Jan. 2 remains to be seen, sources agreed.