Steel Products Prices North America

SMU Ranges & Indices: Mixed Messages with Some Slippage

January 28, 2014

Steel buyers reported a mixed bag this week with some mills quoting extremely long lead times (hot rolled at 6-8 weeks) while others were still willing to discuss pricing in early February if a reasonable order was connected to the competitive quotation. One service center executive told us about mill lead times, “USS is in 2nd week Feb for HR [plant not identified], which is unusually short for them. There have been many unreported short outages/lost mill production segments, due to the weather. These have served to actually extend lead times longer than they otherwise would be. One mill said the weather disruptions have masked the weak order book for the moment, as orders are reassigned and re-promised out.”

We heard from a mill source that “the market seems to be fragmented.” They went on to point to US Steel as having a good order book and still being limited on melt which they felt would be resolved with the return of the Fairfield blast furnace. They pointed to the issues at AK Steel which has effectively taken them out of the spot market and the strong contract order book at AM (ArcelorMittal) which is keeping them out of the spot market. Essar Steel Algoma has some limitations on production and ThyssenKrupp seems to have filled their order book with aggressive contracts and 1st Quarter spot business. On the flip side they point to a couple of the mini-mills have become aggressive recently although the words used were “slightly aggressive” as opposed to dropping their drawers for an order.

A large service center advised SMU that the upper end of our range is seeing fewer and fewer transactions. “Pricing was holding up well for most of the second half. Planned outages, AK not coming back, USS lockout, and heavier ordering in Q4 (due to Q1 uncertainty) all made a contribution. Now all of those are removed and the US mills gave some Q1 (and some Q2) market share to imports. The new ‘big’ spot market for steel transactions the mills were hoping to create by changing the methodology of contracts does not seem to have materialized. The result is prices are reversing.”

Another service center told us the cold weather has been playing havoc at the steel mills, “Lead times are out. I was just told 6-8 weeks for HR depending on item and particular line [steel will be run on]. So, although no mill outages, cold weather is playing havoc with mills.” This particular distributor was seeing offers around $670-$680 per ton on hot rolled.

With the exception of cold rolled, Steel Market Update found some slippage in hot rolled and minor slippage in cold rolled and coated steels compared to one week ago.

Here is how we are seeing prices this week:

Hot Rolled Coil: SMU Range is $640-$690 per ton ($32.00/cwt- $34.50/cwt) with an average of $665 per ton ($33.25/cwt) FOB mill, east of the Rockies. Both the lower and upper ends of our range decreased by $10 per ton compared to last week. Our average is now $10 per ton lower compared to last week. Our expectation is for hot rolled pricing to move sideways over the next 30 days.

Hot Rolled Lead Times: 2-6 weeks.

Cold Rolled Coil: SMU Range is $760-$820 per ton ($38.00/cwt- $41.00/cwt) with an average of $790 per ton ($39.50/cwt) FOB mill, east of the Rockies. Both the lower and upper ends of our range remained the same compared to last week. Our average is now unchanged compared to last week. SMU anticipates cold rolled prices will move sideways over the next 30 days.

Cold Rolled Lead Times: 5-8 weeks.

Galvanized Coil: SMU Base Price Range is $750-$790 per ton ($37.50/cwt- $39.50/cwt) with an average of $770 per ton ($38.50/cwt) FOB mill, east of the Rockies. The lower end of our range decreased by $10 per ton compared to last week while the upper end remained the same. Our average is now $5 per ton lower compared to last week. SMU anticipates galvanized base prices will trend sideways over the next 30 days.

Galvanized .060” G90 Benchmark: SMU Range is $810-$850 per ton with an average of $830 per ton FOB mill, east of the Rockies.

Galvanized Lead Times: 4-8 weeks.

Galvalume Coil: SMU Base Price Range is $750-$800 per ton ($37.50/cwt- $40.00/cwt) with an average of $775 per ton ($38.75/cwt) FOB mill, east of the Rockies. The lower end of our range decreased by $10 per ton compared to last week while the upper end remained the same. Our average is now $5 per ton lower compared to last week. The expectation is for Galvalume prices to move sideways over the next 30 days.

Galvalume .0142” AZ50, Grade 80 Benchmark: SMU Range is $1041-$1091 per ton with an average of $1066 per ton FOB mill, east of the Rockies.

Galvalume Lead Times: 5-8 weeks.

Below is an interactive graph which compares all four of the flat rolled products referenced above. The graph allows you to manipulate the time series and how you wish to view the data. To do this you must be logged into the SMU website. If you need assistance with logging into the site please contact our office: info@SteelMarketUpdate.com and we will help you.

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Brett Linton

Brett Linton is a senior analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.