Steel Mills

Key Price Driver for October: Solidarity
Written by John Packard
November 4, 2013
For the past couple of months Steel Market Update (SMU) has been writing about how supply constraints have helped keep flat rolled steel prices level to slightly rising. With the round of price increase announcements made at the beginning of the month of October, we have seen a new found resolve by almost all of the domestic mills to hold the line and collect higher prices.
This may be the result of new management at Severstal NA and at the top of U.S. Steel. The marching orders appear to have been well spelled out and as the month progressed spot prices did indeed rise.
One other reason why the mills are resolute in collecting higher spot prices is we are in the midst of contract negotiations. What makes this year unusual is with but one exception (ThyssenKrupp), all of the mills are insisting on changes to the way contracts have been negotiated over the past few years. The mills no longer want to accept CRU “minus” contracts and are looking to replace them with either firm quarterly or semi-annual contracts or, contracts which start at “spot” numbers (be it CRU or Platts) and any discounts are to be done in the form of a modest rebate provided tonnage and release requirements are met by the customer.
As the month of October ended we found a large number of contract negotiations continuing with one of the conversion mills admitting to SMU that they had not yet closed a single contract.

John Packard
Read more from John PackardLatest in Steel Mills

Hot-rolled coil market remains slow, market participants say
Hot rolled spot market participants reported another week of moderate demand and ample supply, with no strong signs that conditions will change next week.

CRU: Blackout knocks out ArcelorMittal mill ‘for months’
Truchas works in Lazaro Cadenas, Michoacan, western Mexico. Repairs may take up to six months.

Nippon Steel posts quarterly loss on cost to buy U.S. Steel
Nippon Steel earnings take hit from buy of U.S. Steel.

Atlas completes Evraz NA deal, renames firm, and hires former USS exec as CEO
Atlas Holdings has completed its acquisition of Evraz North America (Evraz NA) and its subsidiaries.

ArcelorMittal: As tariffs slow global growth, Calvert could be a bright spot
ArcelorMittal expects less demand growth across most of the markets it operates in, including the US, because of President Donald Trump’s tariffs. But the Luxembourg-based steelmaker also thinks it stands to benefit from an increasingly regionalized world thanks to investments like the new EAF at its mill in Calvert, Ala.