NEW YORK Steel sheet prices in the Midwest fell slightly this week after a period of stability, with market participants outlooks differing for the rest of the year.
Hot-rolled band was put at $32.75 per hundredweight ($655 per ton) f.o.b. Midwest mill, sources said, down from $33 per cwt ($660 per ton) a week ago, with larger tonnages available at $32.50 per cwt ($650 per ton). Cold-rolled tags fell to $37.75 per cwt ($755 per ton), off from $38 per cwt ($760 per ton) a week ago, with larger tonnages said at $37 to $37.50 per cwt ($740 to $750 per ton).
"Demand is chugging along pretty steadily. Inventory levels are among the lowest theyve been in months, and with certain supply disruptions its going to keep supply tight," one mill source said, referring to U.S. Steel Corp.s lockout at its Lake Erie Works in Nanticoke, Ontario, ArcelorMittal USA LLCs Cleveland furnace outage in September and a fourth-quarter outage at Nucor Corp.s Berkeley mill in Charleston, S.C. "Buyers are waiting to see whats going to happen. Fundamentally, I dont see why the market would drop, but people are nervous. They also cant wait that long to buy."
Business held steady at the service center level despite increasing news of deal cutting, sources said, particularly as many are ramping up ahead of a typically busier September period.
"Things are good. Theyre not fantastic and its not terrible, but weve got a nice book of business for September," one Midwest service center source said. "With all the production issues, I dont see any major cracks. But I think people are still waiting for a host of factors, including ThyssenKrupp AGs (Calvert, Ala., mill) sale and the OCTG (oil country tubular goods) trade case. I think, though, were towards the top for pricing, but I dont see anything significant that would mean a crash."
Others are cautious because certain supply disruptions and lackluster demand have made the outlook foggy. Service centers have increasingly said they are sticking with a "buy what you need" mentality, with many refusing to place more tons at the mill without an order in hand.
"We heard this week the first signs of things not making sense and certain mills cutting major spot deals," a southern service center source said. "I think the mills are going to try and collect another increase, but were going to try and wait it out. I cant pay these numbers (from the mill) and collect it out there. If youre a true spot buyer, youd better proceed with extreme caution."