Steel Market Chatter This Week

Do you think mills will announce another round of price increases?

“Will = yes: Why = to firm up the bottom & ensure the first $60 can be collected: When = before Christmas.”

“I do think they will announce another increase just before Christmas. I do not think that they want to open February at the same level as January.”

“If they follow the typical “Mill Playbook” they absolutely will. My biggest fear is that it doesn’t stick and pricing heads back down lower.”

“Yes, in January to make sure the first increase sticks.”

“Yes. They will cite more demand and high costs to justify another round. This is needed to actually get prices up.”

“Maybe, depends on if they can get it to stay around $600–650.”

“Yes, but after the 1st of the year. It is important for the mills to solidify the floor that has been set.”

“Probably first of year.”

“Yes. We’ll see another round by early January. It will help solidy their first increase.”

“Yes, activity will pop again soon.”

Where do you think steel prices will bottom, and when? Or have they already reached a bottom?

“Bottomed now — scrap headed up for December and January — Q1 price increases coming.”

“My assessment is pricing will stabilize until January and the bottom may be end of January as demand currently is weak.”

“They have already bottomed, all index prices that are forward looking are up.”

“Already bottomed — prices are going back up.”

“We have to at least be “bottoming” out if not at the actual bottom. Lead times extending this past week, along with an uptick in utilization rates and some strength in scrap are welcomed signs.”

“HRC hit bottom already.”

“I think the price will float between $600–650. I don’t feel that it has stabilized yet.”

“To be determined… Not sure we have seen a sustained floor just yet.”

“Our market is now in an uptick mode.”

“Close to bottom now.”

“Plate prices won’t bottom until sometime in 2023.”

Is demand improving, declining or stable?

“Long term trend is still declining but sense a recent improvement brought on by gradual restocking and deal making.”

“Demand will be better in Q1 versus Q4.”

“From everything we hear from service centers and mills, demand remains pretty bleak. That could be the biggest key of all, on whether these increases stick or not.”

“Declining as recession fears and number of new orders is slowing for the new year.”

“Stable, meeting forecast.”

“Improving, many of our OEMs haven’t slowed down and almost all of them have maintained their prices downstream. They are building cash that will be available to hire new people or upgrade capabilities. Unfortunately the raising of rates by the Fed will slow down any recovery.”

“Mix — depending on specific markets.”

“Plate — stable — some seasonal softening.”

“Demand seems steady. Soft in some areas and good in others but future is not clear.”

“Stable but Nucor plate price decrease announcement added uncertainty to the spot market.”

“Stable at best.”

Are you building, maintaining or reducing inventories in Q1?

“Maintaining, demand is overall driver, so not speculating.”

“[Inventories] will continue to reduce until the back side component & labor issues ease.”

“We remain “maintaining” but every service center we talk to is still in a reduction mode (and that is even with lead times now into the new year).”

“Maintaining inventories due to sale slack is starting for end of Q1.”

“Over bought, thinking 2022 demand would equal 2021… so doing best to reduce inventories.”

“Our inventory is low, so we are building inventories.”

“I only buy back to back. Currently buying less as we have been doing for the past six months.”

“Maintaining to building.“

Are you seeing the impact of new North American capacity in the market?

“Yes, mills are willing to negotiate and pricing is lower than offshore with good lead times.”

“Not really but hoping it will be a postive impact come Jan-Mar 2023.”

“Our answer here remains “Yes” as the newer capacity in the Southwest continue to be very hungry for tons and thus leading the charge lower (and now resisting some of the urges to raise their pricing).”

“Not at all.”

“Not sure yet. Seems availability good overall due to more capacity.”

“Not yet but expect to in Q1 23.”

“Yes, I think we have seen it all year.”

PSA: If you have not looked at our latest SMU Market Survey results, they are available here on our website to all Premium members. We often refer to this as our ‘Steel Market Trends Report,’ and we publish updates every other Friday. We encourage readers to explore the full results, as we simply cannot write about all of the information within. After logging in at SteelMarketUpdate.com, visit the Analysis tab and look under the “Survey Results” section for “Latest Survey Results.” Historical survey results are also available in the Survey Results section under “Survey Results History.” We will conduct our next market survey next week, contact us if you would like to have your company represented.

By Brett Linton, Brett@SteelMarketUpdate.com