Mexican long steel products producer Deacero SA de CV is
looking to grow its presence in the U.S. merchant bar
"The new mill in
northern Mexico makes merchant bar products and they are
targeted to the NAFTA (North American Free Trade Agreement)
area," a spokesman for the company told AMM in an
Multiple buyer and
competitor sources said the steelmaker already appeared to be
boosting its efforts outside of its traditional sales
"The Mexican market
itself is not very active and they need to establish themselves
(in the United States)," one trader said.
An East Coast
distributor said he had been offered material from the
Monterrey-based steelmaker recently.
The trader confirmed
that Deacero material was being offered into the East Coast and
even Canada, but noted that the company was particularly
competitive in the Southwest due to low freight costs.
"Ive heard numbers (for 2 x 2 x ¼-inch angles) as
low as $660 per ton ($33 per hundredweight)," he said, although
other sources reported offers at or slightly below $700 per ton
($35 per cwt) from the Mexican steelmaker.
Domestic prices for 2
x 2 x ¼-inch angles are around $753 per ton ($37.65 per
cwt), 3 x 3 x ¼-inch angles are $762 per ton ($38.10 per
cwt), 8- x 11.5-inch channels are $747 per ton ($37.35 per cwt)
and ½- x 4-inch flats are $757 per ton ($37.85 per cwt)
after mills again held prices steady this month (
amm.com, July 9).
Mexican producers in
general are said to be dominating the import merchant bar
market, with Turkish material less attractive at the moment at
around $720 per ton ($36 per cwt), sources said.
(Mexican) numbers, offerings from Turkish producers have no
traction today," the trader said.
Sources said that in
some cases domestic mills were attempting to match the import
prices, but it was not typical. In the United States, most spot
purchases were still said to be going at list price, with few
distributors willing to take larger positions and push for
whether the recent rise in U.S. ferrous scrap prices (
amm.com, July 3) would lead domestic mills to push
for a finished steel product increase soon, although most were
expecting flat prices in the near future due to typically
slower market activity over the summer months.
"As long as demand
stays low, youre not going to see much changing," the
East Coast distributor said.
If domestic producers
raise prices and scrap tags continue to go up, traders said
spreads might once again become more favorable for material
from overseas producers, although demand has a role to play as
"Demands got to
kick up. Just because pricing looks good, demand still has to
be there," a second trader said.
The first trader added
that few companies are willing to take positions at the moment
to justify large shipments. "Theyre pretty strict with
inventory control. They used to buy 1,000 tons; now
theyre coming with 100, 150 tons," he said.