US domestic plate market not strong enough to absorb full increase

Friday, 09 August 2013 00:48:25 (GMT+3)   |   San Diego
       

About one month ago, US domestic plate mills announced price increases for $1.50 cwt. ($33/mt or $30/nt), but spot prices have only barely started to move in response. The mid-July price increase appeared well-timed: spot prices had gotten down to $34.00 cwt. ($750/mt or $680/nt) ex-Midwest mill, demand was stable and scrap prices increased significantly in early July. However, in the weeks following the increase, it became evident that with inventories well-stocked at many service centers, customers did not feel the need to rush out and make high-volume buys.

Throughout the latter half of July, plate spot prices did not move--customers told SteelOrbis that mills were willing to take orders at pre-increase levels up until August 1. Since the start of the month, mills have been trying to increase prices with all new orders, and have been successful in many cases. Spot prices are up about $1.00 cwt. ($22/mt or $20/nt) in the last couple weeks to $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt) ex-Midwest mill. Official mill asking prices are about $0.50 cwt. ($11/mt or $10/nt) above the high end, but buyers have said that mills generally appear content to get even a part of their announced price increase given the market's current lull. Imports aren't much of an issue, and few, if any offers from offshore have been heard in the last couple months. Import arrivals, on the other hand, are poised to rise in late September/October when previously purchased Turkish plate begins to hit ports.


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