Spot prices for US domestic cut-to-length plate have trended up $20/nt since our last report two weeks ago, with a strong anticipation that another increase may emerge before the close of September. Customers are reporting that at current, the most commonly seen transaction ranges are at approximately $40.00-$41.00 cwt. ($882-$904/mt or $800-$820/nt).
According to a number of service centers, plate has been relatively immune to the up-again down-again up-again trend currently seen for other flats products, because plate producers "seem to have a better grasp of supply and demand" then the people who are rolling coils.
End-use markets for plate are also experiencing modest upticks, which is good news for service centers. According to a September 2 announcement made by the US Department of Commerce, new orders for manufactured goods for the month of July were up by 0.1 percent ($0.6 billion) to $409.5 billion. Another boost of good news comes from an expectation of increased demand for agricultural equipment; recent statistics released by the US Department of Agriculture forecast 8 percent growth in farm cash income for 2010, meaning domestic farmers will have a greater ability to invest dollars in new equipment.
Yet another bright spot came from a September 1 report by the Institute for Supply Management, which reported that economic activity within the manufacturing sector expanded in August for the 13th consecutive month, with the overall economy having grown for the 16th consecutive month. Eleven of the 18 manufacturing industries, including primary metals, transportation equipment, fabricated metal products, and miscellaneous manufacturing reported growth in the month of August.
"This year is definitely better than last," commented one service center. "And while we're not expecting Q4 to be great, we're at least forecasting it to be good."
For now, the trend for US domestic cut-to-length plate will be neutral to slightly up, as plate mills are able to take advantage of increased activity in key market segments.
Looking offshore, current offerings for plate have fallen silent. But that's not to say previously placed orders aren't making their way into ports. August import tonnages of cut-to-length plate declined significantly month-on-month, with the US Department of Commerce Import Administration reporting 30,675 mt (license data) having been imported during August, a stark shift from the 64,117 mt (preliminary census data) seen in July. The most significant offshore importer of cut-to-length plate in August was Sweden, at 2,886 mt. This reflects an approximate 1,000 mt decline from Swedish import tonnages seen in July.
