SMU Data and Models

SMU survey: Mills’ flexibility on prices up slightly

August 29, 2024

Steel buyers found mills slightly more willing to negotiate spot prices this week, according to our most recent survey data. Though this negotiation rate has ticked up vs. our previous market check, overall rates have been trending downward since July’s highs.

Every other week, SMU polls hundreds of steel market executives asking if domestic mills are willing to negotiate lower spot pricing on new orders. As shown in Figure 1, 77% of all buyers we surveyed reported that mills were willing to talk price on new orders this week. This is two percentage points higher than our previous rate, but down from the 80-92% range seen across July.

Negotiation rates by product

As seen in Figure 2, negotiation rates remain relatively high for both sheet and plate products, ranging from 71-88%.

The negotiation rate for hot-rolled coil increased four percentage points from mid-August to 71% this week, now down to the lowest rate seen in five months. Buyers of cold-rolled products reported a negotiation rate of 71%, an eight-percentage point recovery from our prior survey. The negotiation rate on galvanized products inched up three percentage points to a one-month high of 83%. Galvalume rates also ticked higher to 82%. Negotiation rates on plate products continue to be the strongest, easing one percentage point from mid-August to 88%.

Here’s what some survey respondents had to say:

“Deals can still be made but require significant volume. However, those deals are still $50-75 per ton higher than deals offered just 30 days ago.”

“Big tons will get you a deal.”

“On large orders- 2,000 tons or more.”

“Yes, with volume.”

“Very selectively.”

Note: SMU surveys active steel buyers every other week to gauge their steel suppliers’ willingness to negotiate new order prices. The results reflect current steel demand and changing spot pricing trends. Visit our website to see an interactive history of our steel mill negotiations data.

Brett Linton

Brett Linton is a senior analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.