Steel Mill Negotiations: No Longer a Buyer's Market

In the cold rolled segment, it’s a 50-50 proposition whether the mills are willing to talk price. That’s down significantly from the 73 percent who said the mills were open to negotiation two weeks ago.

In galvanized, 47 percent reported the mills still open to discounts, but the majority, 53 percent, said the mills “just say no.” About 75 percent said the mills are holding firm on Galvalume prices, as supplies are expected to tighten in the fourth quarter.

Negotiations are more common in the plate market, where 67 percent said the mills are still willing to bargain to capture the sale, while just 33 percent reported the mills standing pat. That compares to 82 percent vs. 18 percent two weeks ago.

Benchmark hot rolled steel prices now average $515 per ton, based on SMU’s latest check of the market. That’s down from about $560 per ton prior to the pandemic, but up from $440 a ton last month. Steel prices have upward momentum following the recent price increase announcements as the economy continues to slowly recover.

Note: SMU surveys active steel buyers twice each month to gauge the willingness of their steel suppliers to negotiate pricing. The results reflect current steel demand and changing spot pricing trends. SMU provides our members with a number of ways to interact with current and historical data. To see an interactive history of our Steel Mill Negotiations data (example below), visit our website here.