Just like the wide flange beam market in the US, the country's plate market is also strong, with rumors flying that mills are expected to begin controlled order entry come third or fourth quarter.
Demand for plates is very strong as consumption continues in the areas of energy pipe production, ship and barge building, and non-residential construction. Prices are at all-time highs and mills are busy. Even more positive, things are expected to get better. Domestic mills are expecting such an increase in demand in the third and fourth quarter that talks are in the works of beginning controlled order entry to guarantee that everything runs smoothly.
The announced $2.25 cwt. ($45 /nt or $50 /mt) price increase for May shipments did go through with domestic prices now ranging from $43.00 cwt. to $44.00 cwt. ($948 /mt to $970 /mt or $860 /nt to $880 /nt) for commercial grades such as A36 and base sizes.
Although scrap prices have been dropping significantly over the last two months, it is believed the plate market is in fact strong enough to withstand those large scrap decreases and hold firm.
In other domestic news, Canadian-US plate producer, IPSCO Inc. announced on May 3, 2007 that it had reached an agreement to be purchased by the Swedish steel company SSAB, Svenskt Stal AB. SSAB officials commented that the combined company would offer a more diversified list of products to customers and create a formidable player in the North American market for steel plate. This deal will make Stockholm-based SSAB one of North America's largest producer of steel plate, used to build ships, railroad box cars and other heavy equipment.
On the East Coast, South African plate fabricator Pegasus Steel is opening an operation in Goose Creek, South Carolina, expected to be fully operating by August. The company chose that location for its first US operation partly due to the region's fast-growing military vehicle industry. Pegasus hopes to draw companies from Virginia to Florida with one of the country's largest laser cutting machines in the world, capable of handling steel plates up to 50 feet long and about 1 ½ inches thick.
On the other side of the world, Chinese slab prices have been increasing, putting pressure on foreign plate mills in Russia, Malaysia and Thailand to push their prices up. Although there are not too many plate imports coming into the US, the pricing trend is up, with offers in the range of $39.00 cwt. to $40.00 ($860 /mt to $882 /mt or $780 /nt to $800 /nt) FOB Gulf and West Coast for late third quarter arrivals. Prices are not expected to fall in the near future.
License data from the United States Import Administration show that, for April 2007, worldwide exports to the US for plates in coils totaled 106,306 mt, while halfway through May 2007 the tonnage coming into the US is only 18,629 mt. The export leaders in April were Canada at 52,205 mt, Russia at 14,956 mt, and Netherlands at 14,880 mt.
For plates cut to length, worldwide exports to the US in April 2007 totaled 98,068 with Malaysia being the top exporter at 28,623 mt. Canada came in at number two, exporting 25,102 mt to the US, followed by Thailand with 14,477 mt.