Market Segment
January 28, 2022
Written by Michael Cowden
U.S. Steel isn’t letting current lower prices get it down after a record year in ’21 and in anticipation of more good times rolling into ‘22.
The Pittsburgh-based steelmaker said it had expected the first quarter would be weaker but that such weakness would to be temporary.
Nucor Plate Group said it will increase its fuel surcharge to $40 per short ton (st) next month, effective for all shipments beginning Nov. 1. The Charlotte, N.C.-based steelmaker first said in April that the fuel surcharge was necessary to address rising costs, initially setting the surcharge at $10/st on April 16. The company had previously maintained the $10/st surcharge rate for four straight months through Aug. 17. But it has since doubled its rate in back-to-back months—increasing its surcharge to $20/st in September, followed by its Oct. 15 notice to $40/st. “We remain committed to providing reliable service and transparency as we adapt to changing market dynamics,” Nucor said in a letter to customers on Thursday evening. Nucor announces the surcharge amount on or about the 15th of each month for shipments beginning the following month.
Sheet buyers found mills slightly more negotiable on price this week, while plate buyers thought mills were less flexible on spot price tags, according to our latest survey data. Every two weeks, SMU surveys service center and manufacturer buyers to see whether mills will negotiate on new spot sheet and plate orders. In this week’s survey, 14% of respondents said mills were willing to talk price to secure an order, up three percentage points from two weeks earlier (Figure 1). This is the highest reading since July 8, when the rate stood at 18%.
US service centers’ flat-rolled steel supply increased marginally in September, gaining ground for only the second time all year. Shipping days of supply rose to 45.9 last month, according to SMU data. That figure marks a 3.7% increase from August. September’s result represents a modest gain after inventories hit a five-year low the previous month. But it’s nearly 16% below September 2025 levels. Sheet inventories have averaged ~45 shipping days of supply over the past six months. Flat-rolled inventories represented 2.18 months of supply in September, up 3.7% from August. However, the figure was 15.5% below September 2025. The month-on-month (m/m) gain in inventories resulted from a boost (+21.2%) in intake that was partially offset by a 5% increase in shipments.
Manufacturing activity in New York State expanded sharply in October, according to the Federal Reserve Bank of New York's latest Empire State Manufacturing Survey. New orders, shipments, and unfilled orders rose, while delivery times lengthened and supply availability deteriorated further. The survey’s headline general business conditions index rose 18 points from September to 25.5 in October, the highest reading since December 2021. The new orders index climbed 21 points to 23.2, while shipments increased 16 points to 13.1. Unfilled orders also rose, with the index up eight points to 14.0. The delivery-times index reached 19.8, indicating significantly longer lead times.
The leading bidder for bankrupt Mexican steelmaker Altos Hornos de Mexico (AHMSA) failed to provide the required earnest money guarantee to confirm its $1.4 billion bid for the steelmaker and its Minera del Norte (MINOSA) mining assets. The court will now consider selling the assets to a consortium of creditors. After the bankruptcy auction on Sept. 25, the court overseeing the proceedings granted the leading bidder, Construcciones e Ingenierías Electromecánicas SA de CV (CIESA), ten days to provide a bid bond of $56.3 million. The Oct. 13 deadline passed without any prequalified bidders, including CIESA, providing the required amount. In fact, the court said CIESA deposited only 5,000 Mexican pesos (US$271).