Today, a handful of US domestic CRC producers have announced their second price increase in less than a month. As noted last week, on May 1, Nucor and US Steel announced a $2.50 cwt. ($55/mt or $50/nt) increase for domestic CRC, whereas AMUSA set a new minimum base price of $35 cwt. ($772/mt or $700/nt).
Today, NLMK USA, and US Steel have announced they’ll be raising prices by a minimum of $2.00 cwt ($44/mt or $40/nt), effective immediately, whereas AMUSA has set new CRC base pricing at $37 cwt. ($816/mt or $740/nt.)
Current US domestic CRC pricing, however, remains stable week-over-week, in an approximate range of $32-$34 cwt. ($705-$750/mt or $640-$680/nt), ex-mill, which continues to be lower than the base price established by AMUSA in their first increase.
“We all kind of figured this was coming,” one source said. “At this point it may be the tried-and-true strategy of ‘announce two and hope the second forces the first into acceptance’.”
And while lead times have begun to trend out, a situation which is largely tied to buyers placing a flurry of orders when they felt confident that market prices had bottomed, end-use demand levels remain unclear.
For example, on Tuesday afternoon, Ford Motor Company announced they would temporarily re-close its Chicago and Dearborn car and truck plants after three employees tested positive for coronavirus. Although the shutdowns are expected to be brief (the Dearborn plant is projected to reopen later tonight), the on-again-off-again siphon of demand, due to possible coronavirus outbreaks at manufacturing facilities, may impact mills’ ability to push prices higher.
On the other hand, mills’ have been restrained with their capacity utilization rates, which is indeed a positive sign. Earlier this week, AISI announced that for the week ending May 16, the domestic capacity utilization rate was at a scant 52.7%.