SMU Data and Models

Steel Mill Negotiations: No Sign of FR Price Hike

November 8, 2018

Most buyers tell Steel Market Update that flat rolled mills are open to price negotiations on hot rolled, cold rolled and coated steel products. The notable exception is plate. Two out of three respondents to SMU’s latest market trends questionnaire report that plate mills will not compromise on price, while one-third have found some wiggle room in plate price negotiations.

Steel Market Update tracks how buyers and sellers of flat rolled steel characterize price negotiations with the mills. In the hot rolled category, 78 percent of buyers said they have found mills willing to talk price, up from 68 percent in mid-October. Only about 22 percent say the mills are now holding the line on HR.

In the cold rolled segment, 85 percent said they have found mills open to price negotiation, a percentage relatively unchanged in the past month or so. About 15 percent of respondents reported current mill prices on cold rolled as firm.

In the galvanized sector, 73 percent said the mills were open to price discussions, down from 87 percent a few weeks ago. About 27 percent of buyers report that prices are nonnegotiable.

For Galvalume, 78 percent of those responding reported the mills as willing to negotiate AZ pricing, with just 22 percent saying price offers were “firm.”

The price hike announced by several major mills last month is clearly not gaining much traction.

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, visit our website here.