Will price increases be enough to turn the US flats market around?

US domestic flat rolled mills' price increases this past week on the heels of price erosion the last couple weeks came as little surprise. AK Steel kicked off the slew of price increases with a $2.00 cwt. ($44/mt or $40/nt) immediate price hike, and was swiftly followed by the remainder of flat rolled mills. While others, including Nucor and NLMK USA, announced a $2.50 cwt. ($55/mt or $50/nt) immediate price increase, sources tell SteelOrbis that all mills' target price on hot rolled coil (HRC) is approximately around the $32.50 cwt. ($717/mt or $650/nt) ex-mill--and $5.00 cwt. ($110/mt or $100/nt) higher on cold rolled coil (CRC)--that ArcelorMittal USA indicated in its $2.25 cwt. ($50/mt or $45/nt) price increase letter. In an interesting twist, ArcelorMittal USA also said that its new prices are only effective through February 6--a move industry insiders say could be a precursor to another price increase next month.

This past week's increases spurred some buying activity, which sources say was likely mills' main concern when issuing the price increase. Whether spot prices increase as a result is yet to be determined and will likely be impacted by February's scrap move, which is currently predicted to be sideways again. Consequently, US buyers aren't willing to bet on futures right now, and while Chinese CRC is gaining some attention from customers on the US West Coast, those in the Midwest and East Coast regions are finding local material a safer buy and more attractive price-wise.

**DDP loaded truck delivered into Houston