In contrast to the slowing demand and steady price decline taking place in other steel product lines in the US, the domestic steel plate market has been maintaining its strength, allowing plate producers to keep prices stable for October shipments, even though scrap prices have plummeted.
Steel plate is probably the strongest steel product out there and, thanks to the booming energy sector, it's expected to remain that way. Although busheling scrap prices took a dive earlier in the month, plate producers are keeping transaction prices stable in October, instead of lowering them like producers of most other steel products were forced to do.
Domestic standard plate prices are in the range of $74.00 cwt. to $75.00 cwt. ($1,631 /mt to $1,653 /mt or $1,480 /nt to $1,500 /nt) FOB mill for commercial grades (A36, base sizes, coiled and mill plate) in the Gulf region.
Offering prices for domestic plate are significantly higher than they were at the beginning of the year. In January, buyers could find domestic plate for approximately 43 percent less than the prices at which it is offered now. Since the beginning of 2008, plate producers have raised their prices every month to keep up with the increased demand, and this is the first month the market is not seeing an increase.
Going forward, if scrap continues to trend down so dramatically, plate producers may have to lower their numbers slightly; however, it is not expected that prices will fall significantly anytime soon. The outlook is good and the market is expected to remain strong. The end-use markets for plate are robust: energy, railcar building, shipbuilding, and infrastructure are all seeing strong activity.
On the import side, very little is trickling in, though more offers are starting to appear as the US dollar has been gaining strength. At the current time, buyers are buying mostly from domestic mills, although the new import offering levels may pique some interest and we may begin to see an influx of plate imports come next year.
Data from the US Import Administration show that during July and August 2007, for cut-to-length plates, tonnage arriving in the US totaled about 220,288 mt, while only totaling 170,975 mt in the same months of 2008.
Now, import numbers are falling, leaving an approximate $10.00 cwt. ($220 /mt or $200 /nt) gap between domestics and imports. So come January, when these offers are expected to arrive, we may see an increase of tonnage at the ports.
Import offers of standard plate from Malaysia are now in the range of $64.00 cwt. to $65.00 cwt. ($1,411 /mt to $1,433 /mt or $1,280 /nt to $1,300 /nt) FOB loaded truck, US Gulf Coast ports.
Russia and Ukraine have yet to come out with new offers since SteelOrbis' last report, though offering prices are expected to be down when they return to the market.
For the narrower-width plate, Thailand is offering in the range of $65.00 cwt. to $66.00 cwt. ($1,433 /mt to $1,455 /mt or $1,300 /nt to $1,320 /nt) FOB loaded truck, US Gulf Coast ports, a $2.00 cwt. ($44 /mt or $40 /nt) decrease from their last offering.
Offers to the US for heat-treated plate, grade A514, have been lacking due to the increasing global demand for this product. The domestic market is pretty tight as well as this product is highly used by the military. The domestic price for this product is approximately $100 cwt. ($2,205 /mt or $2,000 /nt).