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Traders optimistic about 2013 prospects: AIIS

Keywords: Tags  survey, AIIS, steel traders, hot-rolled, cold-rolled, steel, Catherine Ngai

NEW YORK — Steel traders appear somewhat optimistic about market conditions in the coming months, with many anticipating an increase in finished steel sheet imports, but many continue to see oversupply as a major setback to growth.

Those sentiments were reflected in the American Institute for International Steel’s (AIIS') December market survey, with all respondents expecting an increase in cold-rolled sheet and corrosion-resistant steel imports in the next two months, while 73 percent expect an increase in hot-rolled sheet imports.

All participants said that compared to one to two months’ prior, cold-rolled sheet and structural steel imports were priced moderately higher, while 73 percent said hot-rolled sheet was priced moderately higher.

Some buyers, however, told AMM that they expect domestic sheet prices to slide in the short term, causing potential buyers to think twice about foreign material.

“There’s nothing I can see that’s good in the foreseeable future, as far as I’m concerned. The foreign offers aren’t better than domestic right now, and what they’re working against is the time factor,” one buyer said of long lead times for foreign material. “You cannot justify it.”

Based on orders currently being placed, 94 percent of survey participants said they expected cut-to-length plate imports to be about the “same” in the next three to five months.

All survey participants said there was a “moderate oversupply” in corrosion-resistant steel, wire rod and merchant bars. When it came to hot-rolled steel supply, 91 percent said supply was “about right,” while 90 percent said cold-rolled steel supply was in “moderate oversupply.”

But even with oversupply working against them, some are hoping 2013 will be a positive year. Import statistics seem to indicate higher figures in 2012 compared with 2011, according to U.S. Census Bureau data, which traders say means an upward, albeit slow, trend.

“I’m fairly optimistic that this year will be a little better, but we’ll have to see what happens,” said one trader. “This market should be slightly better in terms of demand, and at least higher than last year.”

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