NLMK USA and Nucor Corp. have become the latest
steelmakers to increase base prices on sheet products as buyers
wonder whether the new levels are sustainable in what seems to
be the fourth round of industry hikes.
NLMK USA increased base prices for all steel sheet products by
$25 per ton effective immediately on all new spot orders, the
company told customers in a July 29 letter. The increase
follows similar moves last week by Severstal North America Inc.
amm.com, July 23), AK Steel Corp. (
amm.com, July 25) and U.S. Steel Corp. (
amm.com, July 26).
Charlotte, N.C.-based Nucor also told
customers in a July 29 letter that it was raising minimum
base prices for hot-rolled coil to $670 per ton ($33.50 per
hundredweight), effective immediately, while cold-rolled
and galvanized are $770 per ton ($38.50 per cwt).
U.S. mills have hiked prices four times in the past nine weeks,
effectively moving hot-rolled tags from a transactional base of
$560 per ton ($28 per cwt) to new published prices in a range
of $670 to $675 per ton ($33.50 to $33.75 per cwt).
While sources pegged
hot-rolled coil transactions at $640 per ton ($32 per cwt) last
week, if mills succeed in achieving the higher pricing it would
be the highest hot-rolled prices since May 2012, according to
supply-side issues allowed tags to hold their strength in
recent weeks, many of those have fizzled out, including a
resolved labor dispute at Essar Steel Algoma Inc., AK
Steels blast furnace coming back online and ThyssenKrupp
AG settling slab issues in Brazil (
amm.com, July 24).
Some service centers
said they were concerned that the momentum on mill hikes
wasnt being reflected downstream, causing squeezed
convinced that this latest round is going to stick," one
Midwest service center source said. "This is a bad time for us.
July is historically poor in terms of tonnage, and from what I
can see in the fundamentals I just cant imagine how this
will continue to go up. The issue with a failed increase is
that it just doesnt stop where it started."
Others, though, noted
that lead times from most mills for hot-rolled band stretch
into late August, while cold-rolled and coated are into
September and October, which means that prices could hold
steady and even tick up for a few more weeks.
"The mills are trying
to be opportunistic right now. I think people are waiting to
see whats going to happen," a second Midwest service
center source said. "But is the price going to fall? I think
with lead times further out, we have a little more to go.
Things will probably soften in the latter half of