US plate prices have been increasing since the end of May, on the heels of scrap and flats price up-ticks; however, as mills continued raising plate prices through July, a significant gap between listed and spot prices developed.
Nonetheless, SteelOrbis learned that Delaware-based minimill, Evraz Claymont Steel, announced late last week to customers that they had raised plate transaction prices an additional $2.00 cwt. ($44 /mt or $40 /nt). As a result, listed domestic plate transaction prices can now, on average, be found at around $33.00 cwt. to $34.00 cwt. ($728 /mt to $750 /mt or $660 /nt to $680 /nt) FOB mill in the Midwest for commercial grades (A36, base sizes, mill plate); however, the majority of spot offers remain in the high $20s to low $30s cwt. While it is too early to tell whether other mills will follow, Evraz's announcement appears to have been unexpected from most distributors.
Demand remains relatively weak, while according to the most recent Metal Service Center Institute (MSCI) monthly shipment and inventory report, inventory overhang of plate tonnage still amounted to an average of 3.2 months in June and a plethora excess tonnage remains sitting at many US ports. The consensus appears to be that unless more domestic mills follow Evraz's announcement, this could the last plate increase of 2009, until demand and spot offers demonstrate improvement. However, if scrap continues ticking upwards and pushes flat rolled coil prices up further, domestic plate mills may try to continue to ride the pricing momentum for as long as possible.
On the import side, the market remains flooded with excess tonnage in a variety of sizes and quantities just sitting on the ground, especially at US Gulf ports. While some traders have informed SteelOrbis that the inventory has been slowly shrinking, there doesn't appear to be any real rebound in store for plate imports throughout the rest of the year. A couple weeks ago, Brazil was offering plates to the US for September to October shipments at around $30.00 cwt. ($661 /mt or $600 /nt) duty-paid, FOB loaded truck in US Gulf ports, though there haven't been any more realistic offers heard since then.
Preliminary license data from the US Import Administration demonstrates that import tonnage of cut-to-length plates in July were slightly higher than June imports, at 22,195 mt and 22,165 mt respectively; however, census data indicates June import arrivals at 23,776 mt. July census data has yet to be released. Canada and Sweden were the top two plate exporters to the US for the second consecutive month in July, with 13,558 mt and 3,090 mt respectively.