September Steel Prices - Steel Market Update Observations
Steel Market Update (SMU) has been in constant contact with flat rolled steel buyers around the country discussing the latest domestic steel mill offers for September on hot roll, cold roll, galvanized and Galvalume steels.
On Tuesday evenings SMU publishes our flat rolled steel price ranges and indexes on hot rolled, cold rolled, galvanized and Galvalume steel coils fob the mill. This past week there have been minimal transactions but our conversations are clearly pointing to higher prices for new orders in September (lead times).
Regarding September prices – our opinion is the domestic mills are trying to reach specific minimum base prices on hot rolled, cold rolled and galvanized. There continues to be a range but adding a $30 or $40 per ton increase to the last price paid may not do the trick for a company who may have purchased galvanized at a $31.50/cwt base.
The galvanized base price ranges we are hearing are $34.00/cwt to $36.00/cwt for most medium to large buyers. The push over the last day or two of this past week is moving the bottom from $34.00/cwt to $34.50/cwt-$35.00/cwt with some talk of $36.00/cwt base prices. Steel Market Update analysis shows the market is trying to find the new “bottom” and then work up from there.
On hot rolled the numbers being bandied about by the domestic steel mills are $29.00/cwt-$30.00/cwt ($580-$600 per short ton). At the moment there doesn’t seem to be much buyer support at $600 hot roll.
Our analysis is based on our knowledge of active negotiations between multiple mills and buyers. There continues to be few transactions reported to SMU at this moment. This will change over the next few days. SMU will concentrate our efforts to understanding the new ranges by product and any discussions with those who may be paying other than a mill’s published extras.
Steel Market Update is conducting our mid-August SMU Steel Market Survey beginning on Monday, August 16th. Our survey's focus on steel prices, lead times, momentum, inventories, buying patterns, business conditions and SMU Buyer's Sentiment. We will begin publishing the results of our survey in our Steel Market Update newsletter on Tuesday evening (the newsletter is published three times per week). You can register for a free 4-week trial on our website by clicking on the free trial logo.
SMU received a note from one of our readers (a steel buyer) late this past week, “Fortunately I was able to pull the trigger on several offers on my table so I beat the increase and covered us through December. The downside, of course, is if this increase doesn’t stick I could get burned, although my gut tells me I made the right decision.” He went on to tell us, “I bought through service centers at mill confirmed pricing. Yes, SMU played an important role in my process.”
Steel Market Update believes in trying to play an active educational and informational role in the North American flat rolled steel markets. One way we hope to get the word out is through our conferences. Our first steel conference will be held on October 19, 2010 in conjunction with the Metalcon convention in Las Vegas, Nevada. You can find out more about our speakers and about registration in the "Featured News" section of our website. You can also go to Metalcon's website: www.metalcon.com where you can register to attend their convention (show floor access is free) as well as our conference. Steel Market Update is "special program" number 2 (SP2) on Metalcon's website and on their registration form.