Steel Products
Nucor Steel Announces Third $40 Price Hike in the Past Month
Written by Tim Triplett
July 22, 2019
Nucor’s Sheet Mill Group informed customers today that it is increasing base prices on new orders of flat rolled steel by an additional $40 per ton ($2/cwt), effective immediately. The announcement marks the third $40 increase by the market-leading steelmaker in the past month. The $40 price hike applies to all unconfirmed orders of hot rolled, cold rolled and galvanized steel products. Other mills are likely to follow Nucor’s lead soon, as they did with the first two increases.
Earlier today, ArcelorMittal USA announced higher minimum base prices of $630 per ton for hot rolled steel and $800 per ton for cold rolled and coated products, setting a clear target for what the mills hope to collect. The $630 per ton benchmark for hot rolled is in line with Nucor’s $120 in total increases added to the market’s low of approximately $510 per ton reached last month.
Whether the market will accept that large a jump in such a short period of time, and whether there is enough real demand to sustain it, remains to be seen. Until the recent reversal, steel prices had declined by 40 percent since last July when they peaked at around $910 per ton. Most buyers have stayed on the sidelines this year, reluctant to buy steel that was likely to be cheaper in the future. With steel prices now apparently on the upswing, the trend may be having the opposite effect. Buyers with lean inventories may be rushing to order steel today that could be more costly tomorrow, adding momentum and support to the higher prices.
Steel Market Update is canvassing the market this week to gauge steel buyers’ sentiment and the effects of the price increase announcements on mill lead times and negotiations.
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Tim Triplett
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