NEW YORK More
domestic steel mills are said to have increased base prices on
sheet products in a move sources predict will help bring in
buyers off the sidelines.
NLMK USA is increasing base prices for all steel sheet products
by $30 per ton effective immediately, the company told
customers in a June 14 letter, citing improved demand and
extended lead times.
Steel Corp. is also reportedly increasing minimum base prices
on hot-rolled coil to $630 per ton ($31.50 per hundredweight),
at least one customer said he learned by phone from his mill
representative. Charlotte, N.C.-based Nucor Corp. made a
similar move, sources said, although AMM has not seen
official letters from either mill.
Others steelmakers are
expected to follow, sources said.
News of the moves
comes day after Chicago-based ArcelorMittal USA LLC and West
Chester, Ohio-based AK Steel Corp. independently increased
their own base prices (
amm.com, June 13).
Steel sources have
said that this second round of hikes will help solidify the
first round of increases, which were announced in late May for
around $50 per ton (
amm.com, May 23).
Sources noted that
lead times at some of the larger mills have lengthened,
particularly those tied to a stronger-than-expected automotive
industry. In addition, labor issues and planned outages,
coupled with steady business activity, could cause extended
tightness in the market, they said.
"I think the pump was
too dry and needed to be refilled," one Midwest service center
source said. "Were replenishing inventory right now,
which is at a low level."
Market participants, however, noted that it may be too soon
to tell whether prices will stick in the medium and long term.
"Theres a definite change in the wind," one southern
service center source said. "How sustainable is this? Ill
take a very wait-and-see attitude."