SMU Data and Models

Spot Checking Mill Lead Times

Written by John Packard

March 10, 2016

Mill lead times, especially on cold rolled and coated products, continue to be a concern as buyers navigate/negotiate pricing and deliveries on future orders. The longer the lead time the more steel that is needed in the pipeline at both manufacturing companies and distributors. The longer lead times provide ammunition to the domestic steel mills as they attempt to collect the most recent round of price increases.

As we have discussed in the recent past, the integrated mills (USS, AK Steel & ArcelorMittal) are either out of the spot market (thus AK Steel’s $480 hot rolled offers in the spot market) or have limited tonnage to sell. The mills to watch carefully are those associated with commodity markets most of which are listed below.

We have been watching lead times from a number of angles: through our surveys which are conducted twice a month (next one will be next week), through comments we receive during direct conversations with steel buyers, conversations we have directly with steel mill executives as well as lead times sheets that some of the mills publish for their customers.

Today we are going to take a look at a few of the mills who have either provided lead time sheets or given us a verbal indication as to where their lead times are as of this week:

NLMK USA produced new lead time sheets today (Thursday) which have the following production dates on new orders:

Hot Rolled: is the week of March 28th (3 weeks) at both Farrell and Portage.*

Cold Rolled: the week of May 16th for contract customers (9-10 weeks) and Inquire on spot business.

Galvanized: the week of May 16th for contract customers (9-10 weeks) and Inquire on spot business.

*We learned that NLMK (all mills) have about 10,000 tons left of unsold time for the month of April.

Nucor Berkeley as of Tuesday had the following production dates (week ending) for new orders:

Hot Rolled: the week ending May 7th up to 54” and the following week wider than 54” (8-10 weeks).

Cold Rolled: the week ending June 4th up to 54” and the following week wider than 54” (12-14 weeks).

Galvanized: Inquire on all products.

CSN (Terre Haute): as of this afternoon (Thursday) the week ending May 14th on galvanized (8-9 weeks).

Ternium (Louisiana): Buyers were telling SMU that orders were coming back from Ternium (most likely for price).

Steel Dynamics (Columbus):

Hot Rolled: as of today (Thursday) HRC was on an Inquire basis although P & O was the week of April 11th (5 weeks).

Cold Rolled: the week of April 18th (6 weeks).

Galvanized: the week of April 4th (4 weeks).

Note: SDI typically runs short lead times as part of their business model. The mill just opened their April order books earlier this week.

The Techs (MetalTech, GalvTech, NexTech):

MetalTech: Galvanized lead times on hot rolled substrate the week of April 10th (5 weeks) and cold rolled substrate the week of April 24th (7 weeks).

GalvTech: Galvanized lead times the week of April 24th (7 weeks).

NexTech: April order book closed.

John Packard

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