Nucor Increases their Coating Extras

For a number of weeks Steel Market Update has been warning our readers to expect galvanized coating extras changes out of Nucor and California Steel due to higher zinc costs and the fact these two mills had not made changes at the beginning of this year as had the other domestic mills(coating extras are charges mills add to the base price for adding zinc to the steel substrate). Nucor advised their customers this morning (Thursday) of a change in their coating extras on all orders acknowledged to ship the week ending March 6, 2010 (week beginning February 28th). The new extras will replace those last revised and effective as of November 1, 2009.

SMU did a quick analysis of the Crawfordsville, Indiana extras and the range of change is between 12% - 20% within the G40, G60 and G90 coating weights.

Looking at some common items we reference in our newsletter - .060” G90 went from $3.00/cwt to $3.50/cwt a $.50/cwt increase ($10 per ton). Using .028 G60” the extra went from $3.75 to $4.50/cwt a $.75/cwt increase ($15 per ton). Lastly, looking at .019” G90 the extra went from $8.25/cwt to $9.75/cwt a $1.50/cwt increase ($30 per ton).

Nucor extras are always fascinating to watch and compare to the most commonly used extras - those of U.S. Steel. U.S. Steel .060” G90 coating extra is $2.90/cwt and for this one item their extras are in their advantage compared to Nucor. The USS .028” G60 extra is $4.50/cwt or the same as the existing USS extra (which was last revised to be effective January 1, 2009). The .019” G90 USS extra is $10.20/cwt which used to be $1.95/cwt higher than Nucor and now the gap has been trimmed to USS being $.45/cwt higher.