NEW YORK Steel
buyers were puzzled this week by some U.S. mills attempts
to boost prices while others seemed to drag their feet on
announcements, sources said.
Regardless, with most
mills expected to climb on board the increases, buyers have
said that one factor that continues to loom over the market is
compressed margins due to a difficult resale market.
"Im as confused
as the next guy right now," said one East Coast service center
source. "My main supplier has threatened to raise the price on
me and no one seems to be selling off replacement costs. All
this is just driving me deeper into offshore."
America Inc., Dearborn, Mich., last week set hot-rolled at $35
per hundredweight ($700 per ton) and cold-rolled and coated at
$40.50 per cwt ($810 per ton); and AK Steel Corp., West
Chester, Ohio, set an across-the-board boost of $30 per ton
amm.com, Nov. 7).
While other mills have
yet to publicly raise prices, a number of buy-side sources said
they have been quoted higher numbers from both integrated and
mini-mill steelmakers, although some of the larger players
Sheet prices look
poised to hold steady or tick up slightly through year-end,
particularly with lead times moving comfortably into December
and January, sources said.
"Most people think
this will hold through January and then start coming down a bit
in February," a Midwest service center source said. "A lot
depends on whats going to happen, still, with
ThyssenKrupp (AG) and capacity. On the other hand, the spot
market is seeing a major change because of the lack of
index-based discounts. ... The downside isnt quite what
it used to be."
Buyers also continue
to discuss how 2014 will look absent the 5-, 6-, 7-percent-plus
discounts seen in 2013. While mills and buyers confirmed that
most contracts are still in negotiation, an increasing number
of participants believe that producers will hold out.
"Lets face it,
the mills arent going to caveit aint
happening," one southern service center source said. "Why would
you have played the game for this long just to give in now? The
cards have been dealt, and I dont think anyone really
likes their hand. But no one has a way out."
Others said order
books have been steady recently.
"Our business has been
steadier than ever," a Midwest service center source said.
"September had a nice spike and October turned out to be the
busiest month of the year. From what I see in November, it
looks to be a solid month."
SteelBenchmarkers Nov. 13 report confirmed the steady
trend, with U.S. hot-rolled band up just 0.7 percent to $734
per tonne ($666 per net ton) from $729 per tonne ($661 per ton)
previously, and cold-rolled coil up 0.8 percent to $846 per
tonne ($767 per ton) from the $839 per tonne ($761 per