US domestic flats market stabilizes

Price increases have trickled in over the past week and a half from the majority of US domestic flat rolled steel mills, most recently by Nucor on Thursday. Many of the increases vary from mill to mill, with Severstal North America announcing new official base prices, while AK and RG Steel issued immediate $2.50 cwt. ($55/mt or $50/nt) increases across the board and Nucor raised hot rolled coil (HRC) prices by $1.50 cwt. ($33/mt or $30/nt) and cold rolled coil (CRC) prices by $2.00 cwt. ($44/mt or $40/nt), effective immediately. Regardless of the increases' differences, flat rolled mills overall are aiming to push prices to about $33.00-$34.00 cwt. ($728-$750/mt or $660-$680/nt) on HRC and $38.00-$39.00 cwt. ($838-$860/mt or $760-$780/nt) for CRC for December order books.

While sources tell SteelOrbis that mills have not been enforcing the full increase just yet, the lower-priced offers are dissipating rapidly. Over the last couple weeks, deals as low as about $28.00 cwt. ($617/mt or $560/nt) ex-Midwest mill on HRC had been reported for large orders, and buyers with decent-sized orders were able to book at prices below $30.00 cwt. ($661/mt or $600/nt) ex-mill. So while HRC spot prices are unchanged from last week in the range of $29.00-$31.00 cwt. ($639-$683/mt or $580-$620/nt) ex-Midwest mill, the lower end of the range is fading quickly and may be entirely gone by next week. The same is true for CRC, and the lower end of the current $34.00-$36.00 cwt. ($780-$794/mt or $680-$720/nt) ex-Midwest mill range is becoming more difficult to attain.

Although the US domestic flats market is showing some initial signs of firming, how much, if any, of mills' announced increases will be absorbed into spot prices still uncertain, and so import interest remains quiet. Mexican mills have been waiting to see what Nucor announced before making any announcements of their own, and will likely mirror the US domestic price trend in the coming weeks, raising prices if the US market absorbs its price increases.

*DDP loaded truck in US Gulf ports

**DDP loaded truck delivered into Houston