CHICAGO Hot-rolled and
cold-finished bar product prices both fell in May amid lower
scrap surcharges, with hot-rolled taking the bigger tumble,
market sources said.
"Were fairly steady, but
we are down 15 percent from last year," an Ohio Valley bar
distributor said. "Were hoping scrap finds a bottom
"One month is good; one month is
bad" in terms of orders, the distributor said. "Theres
not enough consistency and little momentum."
An upper Great Lakes special bar
quality (SBQ) distributor agreed. "There is flat demand and a
lack of excitement in the market," he said. "It could be a
tough quarter. Mills are desperately trying to hold prices firm
and would like them to go higher, but demand is not supporting
AMMs price for
hot-rolled 1000 series 1-inch rounds now stands at $42.50 per
hundredweight ($850 per ton), down from $44.50 in April, while
cold-finished Grade 1018 moved down just 50 cents to $62 per
cwt ($1,240 per ton). Cold-finished pricing frequently lags
hot-rolled tags and faces less downward pressure due to longer
Producers scrap surcharges
for June look poised to fall another $20 per ton, with Steel
Dynamics Inc., Fort Wayne, Ind., the latest to slate a cut (
amm.com, May 14). It follows a $22-per-ton cut by
Nucor Corp., Charlotte, N.C. (
amm.com, May 13).
"Were dealing with a
difficult business model," the Great Lakes buyer said. "Without
the momentum, you cannot get the increases."
The pace of inquiries has slowed
for a large cold finisher in the Midwest. "We had a bounce in
the first quarter, but April and May have been status quo. ...
We dont foresee an upswing in June or July. Theres
no urgency out there," he told AMM.
"When demand is down, we need to
control inventory. So we are watching that, just like the
original equipment manufacturers are," he added.
Business is down "a little bit"
this month, one East Coast bar distributor said. "Machine shops
either have too much work or dont have any," he said.
"Everybodys saying something different, but the phone
calls and e-mails are not as frequent."
A lower Great Lakes bar
processor said that both his producers and customers have
reported slowing business. But "were holding our own," he
"Theres no real change in
market conditions from last month. Demand continues to be
soft," a national bar distributor in the Southeast said.
"Everything other than Tier I
and II automotive has been pretty soft," a second Great Lakes
bar processor said. "People are still building nonautomotive
parts, but the carmakers are pulling the wagon. ... If we had
another 2012, I would be astounded."