LOS ANGELES Mills are
moving to hike beam prices at a time when some are reporting
significant discounting, and buyers say that its unclear
just which trend will win out.
Nucor-Yamato Steel Co.,
Blytheville, Ark., and Charlotte, N.C.-based Nucor Corp.s
beam mill in Berkeley, S.C., have both reduced their beam base
prices by $10 per ton and boosted their raw material surcharges
by $35 per ton, resulting in a $25-per-ton net increase to
Aprils published transaction prices.
The actions come after
AMMs consumer buying price for shredded
automotive scrap in the Chicago market, a major component of
some domestic mills surcharges, rose last week by $35 per
ton (amm.com, March 7).
The announced increases would
raise the published f.o.b. mill price for core sizes of
wide-flange beams from a current $780 per ton ($39 per
hundredweight) to $805 per ton ($40.25 per cwt). Market sources
were still awaiting April pricing letters from the other major
domestic beam producers as of press time.
"If raw materials are really
firming up, then the mills will have to push up prices," an
Eastern distributor said.
But despite the rising scrap
costs, some buyers questioned how successful the announced
hikes will be as market participants continue to report
discounting by some beam suppliers. Last year, amid widespread
discounting, domestic mills moved to adjust beam prices in an
effort to make published prices more accurately reflect actual
market conditions. By most accounts, they achieved at least
some measure of initial success.
However, while published prices
have remained unchanged for the past four months, reports of an
increasing number of deals began to emerge in the new year.
That accelerated into "foreign-fighter" programs said to
compete with imports and then even more widespread price
cutting, amounting in some cases to discounts of $60 per ton or
more off published prices, sources said (amm.com,
Even buyers in parts of the
country that arent seeing any increase in imports, such
as the East and Midwest, said that domestic mill discounting is
also now part of their own markets.
Meanwhile, the latest beam
import application data suggests that South Korea, which has
been responsible for most of the indicated rise in imports, may
see its influence leveling off.
After fielding permit
applications for 5,373 tonnes of wide-flange imports from Korea
during the first week of March, the U.S. Department of Commerce
received applications representing only 224 additional tonnes
in the subsequent five days, bringing the total permitted
volume through March 12 to 5,597 tonnes.
If this decline in weekly
volumes represents a trend, March imports would fall short of
the approximately 22,050 total tons that was due to arrive in
February, more than 20,000 tons of which was from Korea.
"The real problem is that
theres just not a lot of business," a West Coast
distributor said, echoing the reports of his counterparts in
other parts of the country who said that domestic beam demand
has been disappointing so far this year.