CHICAGO Steel sheet and plate prices held steady this past week in a sign that the steel industry might be dodging the usual summer doldrums this year, market sources said.
Stable prices and lead times also come despite a big gap between pricing in the United States and the rest of the world, as well as high import volumes, they said.
AMMs hot-rolled coil price was steady at $33.50 per hundredweight ($670 per ton), while cold-rolled coil held at $39.50 per cwt ($790 per ton) and plate prices remained at $43 per cwt ($860 per ton).
Domestic mills were said to be mulling increases, given the firm lead times and improving demand. But some market sources said they were unlikely to announce base price increases ahead of a potential wave of trade petitions on sheet steel products.
U.S. mills have said they are collecting information for potential trade cases against imports of cold-rolled, coated and painted steel, including Galvalume (amm.com, July 25).
But domestic mills might be less hesitant to lift pricing elsewhere, such as in coating extras for galvanized material, especially given high zinc prices (amm.com, July 29) and strong demand from the automotive sector, market sources said.
While mills are willing to negotiate coating extras in a weak market, they generally arent in an improving one, some market sources said. However, others scoffed at the idea of changes to a coating-extras regime that they said hasnt changed substantially for three or four years.
Support for domestic prices might be coming in part from fears of trade action, market sources said.
But opinion diverged on whether trade action was imminent. Some sources said petitions were less likely now given improved quarterly results from several domestic flat-rolled producers, while others expressed increasing concern about ordering cold-rolled coil and coated products from China and India, as well as from South Korea and Taiwan.
Some domestic buyers also said they were concerned that potentially heavy duties could be passed along to them, but trader sources generally dismissed such chatter. They argued that a more likely outcome would be order cancellations or, at worst,l buyers agreeing to pay a portion of any assessed duties.
"No buyer is going to sign a contract that says, Were OK with prices going up 50 to 100 percent," one trader said. "Ive heard of traders asking for that but never of anyone accepting it. And if they do, its the fault of the guy who signs it."
Prices for imported hot band, like those for domestic material, were largely stable. However, trader sources said that price increases might be announced by offshore mills because of challenges to the U.S. suspension agreement with Russia (amm.com, July 10).
On the plate front, market sources said lead times continued to be as far out as 10 weeks and reported better demand from the energy sector, as well as the previously beleaguered construction and mining equipment markets. However, some said they were increasingly concerned about import levels rising and pushing domestic tags into a retreat.
U.S. imports of plates in coil look poised to total 203,261 tonnes for July, according to license data from the U.S. Commerce Departments Enforcement and Compliance division. Thats up 83.1 percent from the preliminary June tally of 111,013 tonnes and is more than double the 77,924 tonnes imported in July 2013.
"Imports are at alarming highs. Weve got some deep concerns, and were watching and will continue to be vigilant," one domestic mill source said.