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    September 27, 2016

    SMU Price Ranges & Indices: Buyers Waiting

    Written by John Packard

    The number of active steel buyers has definitely slowed over the past few weeks. Buyers are holding back as business has slowed for some, inventory levels are OK (and in some situations rising) and lead times are pulling back making the need to buy less urgent. When taking into consideration lead times, we are also coming up on the end of the year inventory adjustments that need to be made in states where there is a tax due at the end of the year.

    One service center steel buyer told us today, “Lead times are short and don’t seem to be any signs of going out.  I think that the problem is that with 4th quarter indexed pricing going up (the ones using 3rd quarter CRU Monitor average to set 4Q) – a lot of people will continue to minimize inventory and hold their breath until they can buy 1st quarter contract at much lower numbers…” The bottom line is buyers appear willing to wait, the steel mills are willing to negotiate and the net result is slowly sliding flat rolled steel prices. 

    John Packard

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