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US hot-rolled coil prices inch higher

Keywords: Tags  steel prices, hot-rolled coil, cold-rolled sheet, steel plate, U.S. Steel, OCTG, Michael Cowden


CHICAGO — U.S. hot-rolled coil prices edged up in late June amid anticipation that a big trade case could break in favor of domestic mills, but a lack of pricing consistency among mills and across regions had some sources questioning the viability of one mill’s attempted hike.

AMM’s hot-rolled coil price inched up to $33.50 per hundredweight ($670 per ton) from $33.25 per cwt ($665 per ton) previously, while cold-rolled sheet tags tumbled to $39.50 per cwt ($790 per ton) from $39.75 per cwt ($795 per ton) in the same comparison.

U.S. Steel Corp. recently set a price increase of $25 per ton ($1.25 per cwt) effective immediately (amm.com, June 30).

This would, in theory, put spot prices for hot band from the Pittsburgh-based steelmaker at $35 per cwt ($700 per ton) or higher, several market sources said, adding that some other integrated mills in the Midwest were angling for this level as well. However, no sources contacted by AMM reported transacted business at these prices, with some also noting that integrated mills in the Midwest had few spot tons available.

Even if U.S. Steel’s increase doesn’t drive prices up or prompt other mills immediately follow suit—and no increases are expected until after July 4—some mills that had previously offered prices of $33.50 per cwt or below for even smaller orders have boosted offerings to above $34 per cwt ($680 per ton), market sources said.

But customers of one of those mills said lead times were into September, which they considered too far out to place big orders at higher numbers. They also noted that prices as low as $33 to $33.25 per cwt ($660 to $665 per ton) continued to be available for smaller orders from some mini-mills, and at $32 per cwt ($640 per ton) for big orders—approximately 10,000 tons—to tubers. That’s in part because lead times in the Midwest are generally reported to be much further out than in the Southeast, where some mini-mills reportedly still have tons available for July.

The wide gap in current offerings could also be giving customers a false sense of security, other market sources said. If the U.S. Commerce Department’s oil country tubular goods (OCTG) decision—due July 10 (amm.com, June 13)—goes in favor of domestic mills then other trade actions could follow and the market could tighten quickly, especially given low inventory levels at both service centers and end-users, they said.

While most sources expect to see Commerce rule in favor of domestic mills, others warned that it wasn’t guaranteed. The slow bleed in coil prices in recent weeks hasn’t turned into a collapse in part because domestic mills have maintained discipline in anticipation of a victory on OCTG and a jump in flat-rolled demand, they said. But if Commerce decides against domestic producers, that discipline could fall apart, they said.

Meanwhile, cold-rolled prices slipped amid continued import pressure, especially from China, market sources said.

An even wider gap was reported on cold-rolled between the Midwest in the South, with tags in the South in some cases said to be as low as $37.50 per cwt ($750 per ton). The spread could be due to import competition near the coasts and the higher-end automotive markets served in the Midwest compared with lower-end markets, such as drums for storing oil and gas, served in the South and Gulf Coast.

Meanwhile, plate prices remained unchanged at $43 per cwt ($860 per ton).


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