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Steel plate market ‘malaise’ continues: sources

Keywords: Tags  steel plate, South Korea, Taiwan, Turkey, imports, steel sheet, catherine ngai

NEW YORK — The U.S. steel plate sector remains fairly stagnant as lackluster demand and squeezed margins continue to plague the market, sources said.

"We’re in a malaise here. We’re just kind of hanging around," one plate mill source told AMM. "Volumes are relatively unchanged, but it’s just that malaise has settled into the plate market. There are skinny margins and we’re not expecting to see much movement."

Although steel sheet prices have been moving up steadily in recent weeks, the domestic plate market has been less robust, accepting only a portion of the $60-per-ton increase announced in the spring and prices actually losing some ground in the first week of June (, June 7).

Sources said steel plate prices were steady this past week at around $35.50 per cwt ($710 per ton) f.o.b. Midwest mill, although some said larger tonnages could be had at closer to $34.50 to $35 per cwt ($690 to $700 per ton).

Market participants had previously said that increased offers of Turkish, Taiwanese and South Korean plate were causing downward pressure on plate prices, but a number of sources said it now appears that increased competition at the service center level, rather than imports, is the main factor pressuring the market.

"Plate is pretty stagnant. Prices have shaved down a little bit (and) competition is still pretty rough," a Midwest service center source said. "The service center guys aren’t restocking, and prices from the other distributors are all over the map."

Meanwhile, imports are flowing into the United States at a slower pace than they were at this time last year, data show. Last summer, starting in May, the United States saw five consecutive months of cut-to-length plate imports north of the 100,000-tonne mark; this year, just 61,313 tonnes hit U.S. shores in May, preliminary U.S. Census Bureau data show, and some 70,275 tonnes were set to arrive in June, well below last year’s tallies, according to license data from Commerce Department’s Import Administration.

"This year has been different. We haven’t seen the surge of imports. It’s nothing like that," the mill source said. "The fact is that there’s just not enough demand to keep prices up domestically. Certainly, no one is talking about some sort of ramp-up in the second half."

If the sheet market continues to pick up, however, plate sources are hopeful that could signal a bright spot ahead for their markets as well. But if the momentum on sheet is short-lived, optimism for plate may not materialize, sources said.

"For the sheet world, I think we’re in the calm before the storm," a second Midwest service center source said. "This could be good for plate, but what ultimately concerns me is if demand doesn’t increase substantially (for sheet). Come August, September, when all of these blast furnaces are repaired and come back online, that could cause a downward slide."

Catherine Ngai

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