Expectations that structural steel prices will firm before
year-end are now fading as even a still-awaited wide-flange
beam increase by a key player might not be enough to boost the
market for December shipments.
Until recently, most
buyers saw all the signs pointing to an increase. Gerdau Long
Steel North America, Tampa, Fla., and Fort Wayne, Ind.-based
Steel Dynamics Inc.s (SDIs) Structural and Rail
division in Columbia City, Ind., raised prices $20 per ton
effective Nov. 4 and Nov. 5, respectively. Also,
AMMs consumer buying price for shredded
automotive scrap in the Chicago market rose $31 per ton earlier
this month amid anticipation that scrap could continue to gain
amm.com, Nov. 7).
All that was needed,
most observers agreed, was for Nucor-Yamato Steel Co. to make
the hike unanimous among major domestic producers. But the
Blytheville, Ark.-based producer hadnt acted by Nov. 20,
and buyers said they still werent paying more for beams
since Gerdau and SDI posted their increases.
Even if Nucor-Yamato
announces an increase soon, several service centers have
already ordered the bulk of their requirements through year-end
at prices heavily discounted to both Gerdaus and
SDIs new posted f.o.b. mill price of $785 per ton ($39.25
per hundredweight) for core sizes of wide-flange beams and to a
previous posted price of $38.25 per cwt.
"We have all that we
need through the end of the year," one Midwest service center
buyer said. "Were going to be buying hand to mouth
through next month."
Another Midwest buyer
noted that he had previously "expected beams to follow suit" as
higher prices take hold on other long products such as
reinforcing bars and merchant bars, but now looks for no beam
increase through year-end.
And indications this
week are that scrap prices, instead of continuing to climb,
will now trend sideways at best in December (
amm.com, Nov. 20), making beam buyers increasingly
"Were on the
fence, again," one distribution executive said about his
companys beam procurement plans.
mill time in December is shrinking. Gerdau notified customers
this week that its Petersburg, Va., mill has closed rollings
for December, with January rollings "closing quickly," market
sources said. December rollings at its Midlothian, Texas, mill
are also likely to close soon.
AMM that the Midlothian mill has a scheduled routine
outage from early December to mid-month. While "no planned
outage" is slated for Petersburg, it confirmed "the shortened
rolling cycle, which is designed to best meet the needs of our