LOS ANGELES West Coast
carbon steel plate buyers are viewing the latest move to boost
domestic prices with skepticism in light of continuing heavy
service center inventories as well as a lack of a pickup in
demand outside certain energy pockets.
"I know theyre trying to
shore up prices, and I hope they can do it," a distributor
source said of Lisle, Ill.-based steelmaker SSAB Americas
move to hike plate prices by $30 per ton effective March 17.
"But theyre raising prices at the same time people in our
business are selling steel on the resale market at prices that
arent much better than mill replacement cost."
A source at an equipment
manufacturer whose own energy-related business is picking up
sharply after a flat period late last year stopped short of
predicting the increase will fail, although hes not yet
convinced its on solid ground. He noted that service
centers competing for business "have a lot of material now,"
and there doesnt appear to be strong demand on the West
Coast, in particular, outside his own energy accounts.
Delivered prices to the West
Coast market from domestic mills are reported in a range of
$780 to $800 per ton ($39 to $40 per hundredweight) for larger
service centers. Recent reported offers on foreign plate in a
range of $740 to $760 per ton ($37 to $38 per cwt) for May
delivery arent particularly attractive because few buyers
are willing to bet that the domestic market wont be even
lower by the time the material arrives. Moreover, previously
purchased imports already in warehouses are helping to drive
down the average value of service center inventories.
A number of market sources
appear to agree with their counterparts east of the Rockies
that SSAB might view a planned three-week maintenance outage at
its Montpelier, Iowa, mill as a good time to announce a hike.
One buyer had the impression that plate mills in general are
using the market slump as an excuse for temporary maintenance