US flat rolled pricing - End of the bull market in sight?

The flat rolled market is still going strong, though many market players are not sure how much longer this upward trend can last. There is a nervous, jittery feeling in the market right now as some buyers are starting to resist these higher priced offers. The pricing trend is still moving upward, though not as fast as it has been in the past few months. It is starting to slow down because once-slim inventories are growing, with robust domestic production and increasing numbers of imports coming in. Still, we will probably see another price increase in August as busheling scrap prices are on the rise, and demand is still strong, especially for stainless and galvanized sheet and tubing. Prices for alloys like zinc, used for galvanized sheet, and nickel, used for stainless sheet, are still moving upward, prompting domestic producers like AK Steel to raise their surcharges for stainless and zinc coating. AK Steel's Zanesville plant, which produces electric stainless sheet steel, will go back online later this summer, easing up some of the demand for stainless sheet. Flat rolled prices have not changed since our last report two weeks ago; most hot rolled offers are still ranging from approximately $31.00 cwt. to $32.00 cwt. ($683 /mt to $705 /mt or $620 /nt to $640 /nt). Cold rolled offers range from $35.50 cwt. to $36.50 cwt. ($783 /mt to $805 /mt or $710 /nt to $730 /nt). The import trend is still up as import offers remain uncomfortably close to domestic level pricing. Foreign mills can get away with these prices because the US market is no longer the highest priced in the world, and the home markets in Europe and Asia remain strong. Therefore, imports will only come in if the foreign mills can sell them at a good price. However, growing inventories certainly aren't helping to generate a lot of import bookings right now. If the hesitation continues, import prices may start heading down, further away from domestic prices. Current offers for import hot rolled range from about $30.00 cwt. to $31.00 cwt. ($661 /mt to $683 /mt or $600 /nt to $620 /nt) FOB loaded truck, US Gulf ports. Cold rolled imports range from $34.50 cwt. to $35.50 cwt. ($761 /mt to $783 /mt or $690 /nt to $710 /nt) FOB loaded truck, US Gulf and New England ports.