During AK Steel's Q4 conference call Tuesday, James Wainscott, president and CEO, said that AK is getting a "sense that things are beginning to improve" in terms of steel prices and demand. In Q4, AK Steel ran at just over 70 percent of capacity, and slightly over 80 percent during the full year 2011. Meanwhile, expectations are that utilization rates will increase to about 80 to 85 percent during 2012.
Over the past few weeks, order intake rates for carbon steel have also been improving, he said, and lead times are extending. AK is at a stronger position at this point in 2012 than the same time in Q4. Carbon hot rolled steel coil lead times are at the end of February while cold rolled coil and coated flat steel product lead times are well into March. Since after October 2011, AK Steel has announced three price increase in the spot market for $140/nt on hot rolled coil and $150/nt on cold rolled and coated products. With the market's recent uptick, Wainscott said, customers have been "securing product in a rapid fashion."
Moving forward, Wainscott explained that AK Steel has a desire to focus on more value-added products and can foresee AK shifting more hot rolled production to cold rolled and cold rolled to hot dipped galvanized (HDG).