US WFB market – July prices could be rising despite drop in shredded scrap

Wednesday, 11 June 2008 11:38:47 (GMT+3)   |  
       

At press time, Nucor-Yamato Steel has yet to announce its wide flange beam (WFB) prices for July; however, market rumors are suggesting that despite a decrease in shredded scrap prices, WFB prices are headed up. 

The US market is now awaiting Nucor's July price move and there are some indications that prices may be going up, yet again. Although shredded scrap prices fell approximately $25 /lt from last month, market conditions are still strong enough to allow a price increase for WFB. Most importantly, there are virtually no import offers surfacing in the US market. Without imported material, not only is supply extra tight, but it allows domestic mills to dictate where they think prices should be. Demand for WFB (along with other large structurals) is strong as well. As long as supply is tight and demand is relatively strong, mills can continue boosting their prices. 

Buyers are speculating that another WFB increase is on its way for July, in the area of $40 /nt ($2.00 cwt. or $44 /mt). Although scrap prices fell this month, an increase is quite possible, and if it does happen, prices will be just shy of $1,100 /nt ($55.00 cwt. or $1,213 /mt). This rumored increase has yet to be confirmed by the mills. 

For now and through the month of June, prices for standard-sized WFB (ASTM A992, W10 x 10, W18 x 6, W24 x 7) are at $52.85 cwt. ($1,165 /mt or $1,057 /nt) FOB mill. The domestic pricing trend is slightly up as there is a good possibility that prices will be headed north for July shipments. 

Since the beginning of the year, domestic beam mills have been upping prices continuously. The year 2008 began with a mild $25 /nt increase for January, followed by a larger $65 /nt increase for February shipments. For March, the domestic mills kept prices stable; however they upped them by $20 /nt for April, by a huge $110 /nt for May, and by another $50 /nt for June. In total, the US domestic beam market has seen $270 /nt in increases this year and if the market rumors hold true, and domestic mills do in fact raise their July numbers, the increases may total over $300 /nt.  

Nucor-Yamato's rolling schedule shows a tight order book with the remainder of the summer months working on controlled order entry. For some products, mainly the larger sizes, the mill is working on controlled order entry well into November. 

On the import side, there are very few offers surfacing, if any. There is the occasional spotty offer from Taiwan, but for the most part, import offers are not competitive despite the many increases the domestic market has seen. Import offers are said to be higher than their domestic counterparts. 


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