Short lead times temper effectiveness of US flats increases

Although US domestic flat rolled mills are actively quoting higher prices for all new orders, few customers have actually been forced to pay $35.00 cwt. ($772/mt or $700/nt) ex-mill on hot rolled coil (HRC), and $40.50 cwt. ($893/mt or $810/nt) ex-mill on cold rolled coil (CRC), with the exception of select buyers with extremely small orders. Sources tell SteelOrbis that while most mills experienced a slight influx in orders following the price increase announcements a couple weeks ago, there has been a slowdown in order activity in the last week as buyers have once again returned to only making as-needed purchases while waiting to see which direction the market moves next.

But with HRC lead times as short as two weeks at some mills, many are skeptical as to whether spot prices have much potential to increase. One buyer commented on current lead times: "It's hard to take a price increase seriously when mills are so desperate for orders." Nevertheless, at least for the time being, domestic HRC and CRC spot prices are holding steady from a week ago. Meanwhile, import activity remains slow. Mexican mills have actually been trying to increase their offer prices to the US in light of the US price increases, but haven't had much success, and in the last week, and there have been a few HRC deals reported slightly under the current range of $33.00-$34.00 cwt. ($728-$750/mt or $660-$680/nt) DDP loaded truck delivered into Houston.

**DDP loaded truck delivered into Houston