a base price increase by Nucor Corp., bar pricing likely will
stay level next month, according to carbon and alloy engineered
bar buyers, who said they likely wont adjust their order
N.C.-based steelmaker said in a Feb. 10 letter to customers
that it would raise its transactional base pricing on all
carbon and alloy special bar quality (SBQ) rolled bar products
by $1.50 per hundredweight ($30 per ton) effective with
shipments March 10. Nucor could not be reached for comment.
The base price hike,
which sources consider a leading move, may be meant to balance
a $30-per-ton decrease in the raw material surcharge that Nucor
is expected to implement for March after prices for No. 1
busheling scrap fell this month by roughly the same amount.
"This has to be an
offset move to the decline in the scrap price," one Ohio Valley
buyer said. "I think (the base price hike) will be accepted. If
scrap was up or staying the same, it probably wouldnt
A second buyer in the
region agreed. "We wont change our buying pattern in
March, however. We expect a dip in total mill cost over the
next couple months," he said, citing mill lead times that
"havent pushed out in a year" and the expected spring
arrival of forged bar imports from China, India and Russia.
A source at a
Mid-Atlantic cold drawer said the announcement came as a
surprise. "Suppliers are busy but there are holes" in their
rolling schedules due to lackluster demand from weaker
industries like construction," he said. "You would think (a
price increase) would be tied to increased demand."
An East Coast SBQ
distributor said he would support higher pricing. "Weve
been working with flat pricing for a very long time, which is
not necessarily healthy," he said. Demand, however, "is not
surging by any means. We would relish an upturn in demand in
manufacturing beyond the standard, modest growth expectations
we are all seeing. Were used to going through cycles, and
this has been a non-cycle."
Sources continue to
see automotive and energy as demand bright spots. They also
confirmed that hot-rolled Grade 1000 series 1-inch rounds
continue to fetch about $875 per ton, f.o.b. mill, on the spot