Pipe and Tube Mills Increase Prices on Higher Coil Costs

The pipe-and-tube price increase is effective immediately for all new orders. It also applies to unconfirmed quotes or contracts, the Chicago-based subsidiary of Zekelman Industries said in a letter to customers on Tuesday, Sept. 28.

Orders already on the company’s books will be protected from the higher prices if shipped on or before Oct. 25, the company said.

EXLTUBE later in the day followed with a $75-per-ton price hike for all A500 and A513 products

The increase was effectively immediately for all new orders and for all unconfirmed quotes and contracts. It’s necessary “due to escalating substrate costs and limited supply of finished goods,” the North Kansas City, Mo.-based pipe and tube producer said in a letter to customers.

Like Atlas, EXLTUBE said orders already on its books would be price protected through Oct. 25.

Pipe and tube buyers also told SMU that the increases resulted from higher coil costs. Sheet is the raw material used to make welded tubulars such as HSS, and tube mills are a key end market for hot-rolled coil producers.

“There is very little availability from mill stock, and rollings are selling out into November and beyond,” one Midwest service center source said.

“The tube mills can collect this increase because of the current (limited) availability. They will have to figure out the first-quarter pricing if and when lower cost coil is physically available,” he added.

“Scrap goes down in September and October, HRC showing first signs of a chink in the armor, and tube mills raising prices. … It will be interesting,” one Ohio Valley service center source said.

Hot band prices have dipped modestly in recent weeks. They stood at $1,920 per ton when this article was filed. That’s down $35 per ton from $1,955 per ton in early September but up $60 per ton from $1,860 per ton in early August, according to SMU’s interactive pricing tool.

By Michael Cowden, Michael@SteelMarketUpdate.com