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HSS prices move up but mills split on how much

Keywords: Tags  HSS, flat-rolled, price increase, JMC Steel Group, Atlas Tube, U.S. Steel, steel, Thorsten Schier


NEW YORK — Hollow structural sections (HSS) mills are raising prices, but not in a uniform manner, market sources told AMM.

"It looks split," a Mid-Atlantic distributor source said. "Some are still holding, trying to get that $50 (-per-ton increase). But they’re all trying to get something."

However, it might take some time to see the final results of the increase due to the timespan of a typical buying program, he said. "You won’t know for 30 days down the road."

Barry Zekelman, executive chairman and chief executive officer of Chicago-based JMC Steel Group Inc., said in a recent letter that subsidiary Atlas Tube Inc. is holding the line on its leading $50-per-ton hike despite the "destructive" behavior of some mills that raised prices by only $30 per ton (amm.com, June 7).

A second Mid-Atlantic distributor source said that he saw mills generally making more modest increases. "The increase I’m seeing is anywhere between $10 and $30 (per ton), with more in the $10 to $20 range than $30," he said.

A market source confirmed that some mills that initially followed Atlas have cut back their increases to $30 per ton, but claimed that the revised hike was in full effect. "(They) have gotten $30 (per ton) all day," he said, adding that prices are being bolstered by a tightening coil market.

However, a source at a small Midwest mill said he had not seen any of the increase hold. "Absolutely not one penny of it. All it’s doing is securing the numbers that I have on the books. At least nobody’s trying to negotiate off their future orders," he said. "I wouldn’t think that anybody’s going to lose an order out there because they’re holding that (higher) price."

Sources were unsure whether a second recently announced flat-rolled hike (amm.com, June 13) would trickle through into the HSS market.

"(It’s) hard to say how Atlas will react, but the reality of the matter is that without demand there is no real justification for an HSS increase until coil prices fix at a firm price and not a wishful one," the second Mid-Atlantic distributor source said.

Atlas parent JMC declined to comment.

Demand in the HSS market is steady rather than booming, sources said, making any price increases largely supply-side-driven.

"People are still unsure of where their demand is going. They’re replacing holes, not building inventory," the first Mid-Atlantic source said. However, he added that another HSS hike was possible if there were "universal support" for the latest flat-rolled increase, existing capacity constraints like the strike at Pittsburgh-based U.S. Steel Corp.’s Lake Erie Works in Ontario (amm.com, April 29) continued or if there were some further cut in coil capacity through other labor issues or outages.


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