Hot rolled steel plate spot prices have continued to increase this week, as much of the $5.00 cwt. ($110/mt or $100/nt) price increase from mills announced in mid-February is being reflected in daily transactions.
US domestic plate spot prices have now reached approximately $52.00-$54.00 cwt. ($1,146-$1,190/mt or $1,040-$1,080/nt) ex-Midwest mill, a $2.00 cwt. ($44/mt or $40/nt) increase on the low end, and a $1.00 cwt. ($22/mt or $20/nt) on the high end over previously reported ranges two weeks ago. Asking prices from the mill are around $55.00 cwt. ($1,213/mt or $1,100/nt)-and so at least $2.00 cwt., and as much as $4.00 cwt. ($88/mt or $80/nt) of the mid-February increase is being reflected in daily spot transactions. Nonetheless, order activity on both the mill and service center side has remained steady over the past couple of weeks.
Planned outages from a number of mills at the end of March/beginning of April has tightened the supply of hot rolled carbon plate in the domestic market, pushing mill order books into May, and in some cases even June. Buying activity at the mill has not softened in recent weeks, and so another price increase is still predicted by month's end for late June/July deliveries.
Although US mills are collecting higher prices for May/June deliveries, many smaller steel distributors are still unable to fully transfer the latest mill increase to their customers, forcing some into a margin squeeze, with much of the product being sold selling at below replacement cost. Some end-use customers have even cancelled orders placed one to two months ago on the basis that rising prices have now made certain smaller projects unfinanceable.
That's not to say that activity at the US domestic service center level has drastically slowed. Most service centers continue to make purchases solely to fill orders, but inquiries have increased over the past two to three weeks, allowing many steel plate distributors to grow less wary-if only marginally- of purchasing product at today's spot prices.
With US domestic lead times for steel plate moving into the summer months, and buyers growing more confident that spot prices won't decrease in Q2, offers of carbon steel plate from offshore have become more appealing and inquiries of import plate have risen over the past few weeks as well. Russian and Malaysian offers of cut-to-length carbon steel plate still range from $46.00-$48.00 cwt. ($1,014-$1,058/mt or $920-$960/nt) duty-paid FOB loaded truck in US Gulf ports for June and July delivery-now about $6.00 cwt. ($132/mt or $120/nt) below US levels.
