NEW YORK At least five
domestic steel mills have increased sheet prices as market
participants cite steady activity and an anticipated rise in
ferrous scrap prices next month.
U.S. Steel Corp. appeared to
lead the move, hiking its published base prices for all carbon
flat-rolled steel products by $50 per ton ($2.50 per
hundredweight) effective immediately, according to an internal
memo dated Feb. 26 (
amm.com, Feb. 27).
West Chester, Ohio-based AK
Steel Corp., Charlotte, N.C.-based Nucor Corp. and Portage,
Ind.-based NLMK USA Inc. quickly followed suit, announcing on
Feb. 27 their own $50-per-ton base price increases on all new
ArcelorMittal USA LLC was also
calling customers to set a new minimum base price for April
shipments, sources said.
Other steelmakers, including
those on the West Coast, were said to be mulling similar
While none of the mills cited
reasons for the increase, market sources said an expected rise
in March scrap prices is likely one factor behind the pricing
push. Next months scrap prices have yet to settle, but
steel mill buyers and ferrous scrap suppliers told AMM
last week that they expected scrap prices to inch back up to
January levels due to increased supply tightness (
amm.com, Feb. 19).
"In theory, if scrap goes up
itll make everyone more comfortable," one steel mill
An improving demand situation
could also help lend the sheet price increases some real
traction, sources said.
"Im scratching my head
right now, but it looks like the pendulum may have swung a
little bit," a southern service center source said. "Demand
isnt horrid and this could gain a little traction."
Last month, a number of mills
hiked prices by $40 to $50 per ton ($2 to $2.50 per cwt),
prompting a temporary uptick in prices. However, most of that
upward momentum appeared to give way in early February as
demand stalled out, sources said (
amm.com, Feb. 13), with most transactions this
week reported at $620 per ton ($31 per cwt) or lower.
report, released Feb. 27, also showed a recent softening, with
U.S. hot-rolled band prices down 2.9 percent to $676 per tonne
($614 per ton) from $696 per tonne ($631 per ton) two weeks
But with demand once again
picking up, sources said this round of increases could have
"Overall, February business was
a lot better than January," one Midwest service center source
said. "I was surprised to see an announcement this early,
because I thought mills would plan one for the beginning of
March. Theyll have a hard time as long as these lead
times are this short ... (but) businesswise things are picking
up in the construction sector and will through spring."
The mill source agreed that
demand again appeared to be on an upswing.
"Demand is very delicate right
now and prices have been going down. Were getting too
close (to that breakeven number) and we have to make money," he
said. "Ive been seeing, however, a lot of inquiries in
the past week. Bookings have been OK, so well have to see
more inquiries before bookings start."
However, others expressed
hesitation about the new prices sticking, especially as some
service center buyers continue to sit out of the market.
"The increases out there are
highly questionable. Its like the last one that happened
in Januaryitll be a wait-and-see period," a second
Midwest service center source said.