CHICAGO Pricing and demand
for special-bar quality (SBQ) products remain flat, cold
finishers, processors and distributors report.
Most have given up hope that the second half of the year will
see orders top first-half numbers although they do expect some
pickup in business in the fall.
"Flat fits the pricing
model very well," said an upper Great Lakes cold drawer. "Scrap
goes up and down, then selling price ends up being flat."
The AMM price
for hot-rolled Grade 1000 series 1-inch rounds came in at $829
per ton ($41.45 per hundredweight), off $2 a ton from last
month. Hot-rolled alloy rounds, Grade 4100 series, came in at
$1,002 a ton ($50.10 cwt), up a dollar.
tends to be better," the cold drawer said. "The material
release schedules for automotive, agricultural equipment and
heavy truck are actually looking better. It isnt great
shakes but it feels like more action is coming."
A Southern cold
finisher said he has "tried to apply pressure (on producers)
toward a better input cost but were not getting it.
Its the cold finishers that are hungry, so we are seeing
aggressive pricing (at that level) and we see margins are being
grades tracked by AMM fell by 0.2 percent to 0.7
percent this month, compared with Julys f.o.b.-the-mill
"Weak demand is coming
up against more-than-adequate supply," said a national SBQ
distributor. "August is better than July. There is business out
there, but its competitive."
Pricing discipline has
slackened a bit among producers and distributors, he claimed.
"If you talk to the mills, they love the auto industry but they
could still use more business. Expanding market share is
difficult because the pie is smaller and too many operators are
struggling to keep the piece they had."
His company continues
to buy and stock steel. "We have to have material to sell. It
doesnt mean we get the order, though. I dont fault
a customer for finding a better price."
He, too, said pricing
is static. "You see the surcharge go up a penny, but the base
goes down a penny. This is neither moving the market nor
encouraging people to enter the market."
Other buyers agreed,
with a few saying incoming orders have been up and down all
An Ohio Valley bar
distributor said sales to his largest client are exactly even
year to date with 2012, taking into account lower selling
that the September-October period picks up," said a
Mid-Atlantic cold drawer. "Then at least we wont be