Copying and distributing are prohibited without permission of the publisher
Email a friend
  • To include more than one recipient, please separate each email address with a semi-colon ';', to a maximum of 5

SBQ prices static on soft demand

Keywords: Tags  special bar quality steel, SBQ, prices, market, demand, supply, cold finishers, processors distribuitrs

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.

Seasonally, "fall tends to be better," the cold drawer said. "The material release schedules for automotive, agricultural equipment and heavy truck are actually looking better. It isn’t 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 we’re not getting it. It’s the cold finishers that are hungry, so we are seeing aggressive pricing (at that level) and we see margins are being squeezed."

Three cold-finished grades tracked by AMM fell by 0.2 percent to 0.7 percent this month, compared with July’s f.o.b.-the-mill tags.

"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 it’s 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 doesn’t mean we get the order, though. I don’t 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 summer.

An Ohio Valley bar distributor said sales to his largest client are exactly even year to date with 2012, taking into account lower selling prices.

"We’re hoping that the September-October period picks up," said a Mid-Atlantic cold drawer. "Then at least we won’t be killed."

Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.

Latest Pricing Trends