SMU Data and Models
Steel Mill Negotiations: Buyers Gain the Upper Hand in the New Year
Written by Tim Triplett
January 6, 2022
After a year in which steel mills could basically name their price, 2022 is shaping up to be a buyer’s market – at least for the foreseeable future. Nearly all (96%) of the service center and manufacturing executives responding to Steel Market Update’s survey this week reported that the mills are willing to negotiate prices to secure orders of hot rolled steel.
Likewise, the vast majority of galvanized buyers (84%) and cold rolled buyers (71%) now say deals are highly negotiable in an environment in which steel prices are declining amid widespread inventory destocking and seasonal softness in demand.
“For large blocks of tons, there are some great deals out there,” said one buyer. “The mills are definitely willing to play ball right now. We’ll see if that continues as Q1 gets rolling,” said another.
There is some variation in negotiations depending on the product. Plate is a 50:50 proposition right now, according to SMU’s poll this week. “Plate seems to be holding its own right now, but I don’t know how long that will last,” commented one exec. “Cold rolled and coated are maybe a bit tighter, but mills still seem to be listening. I don’t think anyone is turning away orders right now,” added another.
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 (second example below), visit our website here.
By Tim Triplett, Tim@SteelMarketUpdate.com
Tim Triplett
Read more from Tim TriplettLatest in SMU Data and Models
Foreign HR import appeal shrinks as US prices ease
US hot-rolled (HR) coil prices saw further declines this week, while foreign prices were steady to slightly higher in the three regions we monitor
April service center shipments and inventories report
Steel Market Update is pleased to share this Premium content with Executive members. For information on how to upgrade to a Premium-level subscription, contact info@steelmarketupdate.com. Flat Rolled = 57.8 shipping days of supply Plate = 58.3 shipping days of supply Flat Rolled US service center flat-rolled steel supply edged lower in April, though shipments continue to […]
Galvanized prices maintain big premium over HR
Prices for hot-rolled (HR) coil in recent weeks have been declining faster than those for galvanized sheet, resulting in a growing price spread between the two steel products.
SMU Steel Demand Index falls to an eight-month low
Steel Market Update’s Steel Demand Index fell eight points, and back into contraction territory, an indication demand might be slipping as prices have trended lower, according to our latest survey data.
SMU market survey results now available
The latest SMU market survey results are now available on our website to all premium members. After logging in at steelmarketupdate.com, visit the pricing and analysis tab and look under the “survey results” section for “latest survey results.” Historical survey results are also available under that selection. If you need help accessing the survey results, or if […]