LOS ANGELES Wide-flange steel beam published prices are facing increased pressure as distributor resale tags appear to be coming under renewed assault following a drop in a key scrap barometer.
AMM last week lowered its consumer buying price for shredded automotive scrap in the Chicago marketa major component of some mills raw material surchargesto $390 per ton ($19.50 per hundredweight), a $22 decline from the previous month and a reversal of Marchs $35-per-ton gain (amm.com, April 4).
Domestic mills recently announced a $25-per-ton increase in their published f.o.b. mill price for April to $805 per ton ($40.25 per cwt) on most core sizes (amm.com, March 25).
While a number of buyers said they expect to pay published prices if they order limited tonnages now in order to fill inventory holes, they also indicated they were holding back on substantial requirements until it becomes clear if the mills will repeat the first-quarter discounts seen for larger buys.
"Right now, we cant sell based on published list (prices)," one service center executive said, referring to resale prices that barely match mill tags.
"Weve got a major disconnect in the market again," another distributor said, referring to previous years when resale prices didnt reflect a traditional spread between mill and street prices.
One eastern buyer, who sees beam demand improving, nonetheless believes "beams could come down a bit," and a $15-per-ton cut in the published price would "make sense" under present conditions.