ArcelorMittal USA Sets New Base Price Minimums

Over the past few working days Steel Market Update was aware of at least one mill setting spot prices without an official announcement at $600 per ton on hot rolled and $800 per ton on cold rolled and coated.

An ArcelorMittal USA customer told SMU early this afternoon that they were expecting a price increase and the question being asked within AM was what should the spread be between hot rolled and cold rolled/coated base pricing? With this announcement the spread is being set by ArcelorMittal at $190 per ton ($9.50/cwt).

To put this into historical perspective, for many years the typical spread ranged from $100 to $140 per ton. However, in light of the weakness in the energy markets, in particular coupled with strength in the cold rolled and coated markets, the spread has been widening.

SMU anticipates the other domestic mills will follow with price increase announcements of their own. This is now the 6th round of increase announcements in the current market cycle which began on December 9, 2015.