SMU Data and Models

Mill Lead Times Flat While Price Negotiations Becoming More Prevalent
Written by John Packard
September 19, 2013
SMU found lead times essentially remaining the same on hot rolled (negligible change from 4.0 weeks to 3.97 weeks) and galvanized (6.0 weeks vs. prior 6.07 weeks). Cold rolled lead times dropped from 6.2 weeks to 6.06 weeks while Galvalume lead times moved out slightly from 6.55 weeks to 6.80 weeks.
Lead times are based on the average of the manufacturing and service center responses received during our steel market survey which concluded earlier today (Thursday).
According to the results from our latest survey, the domestic mills have become more willing to discuss/negotiate pricing on virtually all flat rolled products. In early July we found the lowest percentage of mills willing to negotiate pricing (according to our survey). Lead times were the most extended at that time and prices had been moving higher over a number of weeks. As we moved into August the lead times began to shrink and the willingness of the mills to be more flexible began to grow.
Since the beginning of September we are seeing the percentages reaching levels which would suggest prices could begin dropping faster from here – especially on hot rolled and galvanized steels. The product with the most strength is Galvalume. Our data is broad based (OEM’s and distributors and the mills are scattered about the country) and whether or not a mill will negotiate with your company will depend on your relationship, the need of the mill for orders by product, the tonnage requested and your ability to pay timely.
Here is what was reported to SMU this week during the survey process:

John Packard
Read more from John PackardLatest in SMU Data and Models

Apparent steel supply remains elevated in July
Apparent supply totaled 8.88 million short tons (st) in July, down 38,000 st from June and 6% higher than the same month last year

HRC vs. prime scrap spread narrows slightly
The price spread between prime scrap and hot-rolled coil (HRC) narrowed by a hair this month, according to SMU’s most recent pricing data.

SMU Scrap Survey: Current Sentiment rises as Future Sentiment falls
SMU’s current Scrap sentiment index increased this month while future sentiment declined, according to our latest ferrous scrap survey data.

SMU scrap market survey results now available
SMU’s September ferrous scrap market survey results are now available on our website to all premium members.

SMU Survey: Sentiment inches up from low levels
SMU’s Steel Buyers’ Sentiment Indices ticked higher this week, according to the latest data from our flat-rolled steel survey.