NEW YORK Buying
activity in the steel plate sector has remained steady in
recent weeks, sources said, although distributors and service
centers said continued squeezed margins, low inventory levels
and lackluster demand has continued to plague the market.
"The mills are trying
to position and get an increase in the market, but most people
in the market dont think its justified because
demand isnt there," one Midwest service center source
said. "Theres still a lot of (downstream) competition and
that is the biggest problem out there."
Earlier this month,
SSAB Americas hiked plate by $25 per ton (
amm.com, Aug. 9), just four weeks after a
$30-per-ton increase in July. The move was quickly followed by
Nucor Corp. (
amm.com, Aug. 13), which sources said had happened
to solidify the earlier round.
ArcelorMittal USA LLCthe other major player in the
marketgetting on board, some sources said it may be more
difficult to gain traction on the recent upward move.
of throws the whole thing in a dizzy," one mill source
A spokesman for
ArcelorMittal USA could not be reached for comment.
While mills reported
stable bookings recently, distributors have kept inventory
levels thin in an uncertain market.
U.S. service centers
held 993,000 tons of inventory at the end of July, the
equivalent of three months supply, down 12.1 percent from
1.1 million tons (3.3 months supply) a year earlier,
according to the latest data from the Metals Service Center
However, some service
centers said business has been better than last year,
particularly on the fabrication end.
"Were doing good
and getting more hours in the steel shop, so were happy,"
a second Midwest service center source said. "Last year in
July, things died. But this is much better than it was last
year. Price levels, though, are too low and margins are too
Other service centers
said the mining sector has been particularly hard hit, which
has affected the heat-treated and alloy plate markets.
speculated that another round of price hikes may come in the
near term to solidify the second increase and get prices up to
a more comfortable level for the mills, although service
centers warned that its uncertain whether the current
round has enough legs.
"Plate prices have
been pretty steady, but its too early to tell if the
recent hikes are going to stick," a Northeast service center