SMU Price Ranges & Indices: A Wary Eye

This service center then went on to tell SMU, “Mills are saying that buyers are inquiring more often, and with larger tonnage quantities because they now either need to buy, believe prices are at or close to the bottom, or both. In addition, the mills are getting many requests to hold pricing firm for periods including through 2nd Qtr, on through the end of the year. These developments are becoming clear signals to the mills to hold back and be more patient, even though they still have short lead-times. Having weathered what they think is the worst of the storm, they do not want to commit to fixed prices for extended terms, and give up expected upside opportunity. Mills are fishing heavily to determine what’s happening with import pricing and deliveries. They are trying hard to confirm whether the price spreads today between foreign and domestic sources have shrunk below the level where buyers would be comfortable placing import orders. With AM now taking capacity off-line in both Indiana Harbor and Cleveland, along with the other previously announced outages and production cutbacks within the industry, most believe mills have cut what they can for now, and still meet customer demand.”

Another service center located about 500 miles away from the one above told us that the market is close to a bottom (sort of), “I believe the market has further to fall but not much, the bottom is around here somewhere.  There’s always resistance of some sort but everyone is still saying some version of “tell me what I need to do to be competitive”.  What this market needs is a good smack in the face in the form of anti-dumping suits filed against some of the Asian producers of HR, CR and HDG.  That would change the pricing conversation pretty quick though we’re hearing about other countries already lining up to go after some share here.  Low priced, steel making inputs and a strong dollar are a nasty combination for the US producers.  It’s a weird market.  It’s not too often you see decent demand and sharply falling prices at the same time.”

While a number of galvanized wholesalers told those on the HARDI steel conference call this morning that the bottom is close and they are confident enough that they have purchased extra steel for the month of April deliveries.

Steel Market Update is not quite yet prepared to move our Price Momentum Indicator off of “Lower” where it has been stuck for many months, but we are beginning to think we could be headed for an extended period of sideways pricing until such time that the service centers have to come back in and buy. All of this could change rather quickly (or will change rather quickly as it has in the past) with a hiccup, dumping suit or something else that pushes the market enough to impact lead times forcing buyers into the market…

Here is how we see spot flat rolled prices this week (all prices shown are in net tons which are equal to 2,000 pounds):

Hot Rolled Coil: SMU Range is $450-$490 per net ton ($22.50/cwt- $24.50/cwt) with an average of $470 per ton ($23.50/cwt) FOB mill, east of the Rockies. Both the lower and upper ends of our range remained the same compared to one week ago and our average also remained the same as it was last week. SMU price momentum for hot rolled steel is for prices to move lower over the next 30 days.

Hot Rolled Lead Times: 1-4 weeks.

Cold Rolled Coil: SMU Range is $590-$620 per net ton ($29.50/cwt- $31.00/cwt) with an average of $605 per ton ($30.25/cwt) FOB mill, east of the Rockies. The lower end of our range remained unchanged compared to last week while the upper end decreased $10 per ton. Our average is now $5 per ton lower compared to one week ago. SMU price momentum on cold rolled steel is for prices to move lower over the next 30 days.

Cold Rolled Lead Times: 2-6 weeks.

Galvanized Coil: SMU Base Price Range is $28.50/cwt-$31.50/cwt ($570-$630 per net ton) with an average of $30.00/cwt ($600 per ton) FOB mill, east of the Rockies. Both the lower and upper ends of our range remained unchanged compared to last week and our average also remained the same as it was one week ago. SMU anticipates galvanized prices will move lower over the next 30 days.

Galvanized .060” G90 Benchmark: SMU Range is $639-$699 per net ton with an average of $669 per ton FOB mill, east of the Rockies.

Galvanized Lead Times: 3-6 weeks.

Galvalume Coil: SMU Base Price Range is $29.00/cwt-$32.00/cwt ($580-$640 per net ton) with an average of $30.50/cwt ($610 per ton) FOB mill, east of the Rockies. Both the lower and upper ends of our range remained the same compared to one week ago and our average also remained the same as it was last week. Our expectation is for Galvalume prices to move lower over the next 30 days.

Galvalume .0142” AZ50, Grade 80 Benchmark: SMU Range is $871-$931 per net ton with an average of $901 per ton FOB mill, east of the Rockies.

Galvalume Lead Times: 4-6 weeks.

SMU Note: Below is an interactive graphic showing our hot rolled, cold rolled, galvanized, and Galvalume price history. You can only view this interactive graphic when you are logged into the website and reading the newsletter there. If you need help navigating the website or need to know your login information, contact us at info@SteelMarketUpdate.com or by calling 800-432-3475.

{amchart id=”110″ Weekly Pricing Article Graph- Use for NEWSLETTER Prices}