After hearing nothing but crickets from US domestic wide flange beam mills since July, distributors welcomed this week’s $35/nt ($1.75 cwt. or $39/mt) transaction price increase that is effective immediately. Scrap prices are still on the rise along with demand for beams in the US, and although the demand bump is mostly attributed to smaller projects, sources tell SteelOrbis that the price increase is long overdue, and thus easily capable of being absorbed into the market. However, some small to medium-sized distributors are still worried about the massive rebating that typically occurs between mills and the largest distributors--if the practice continues to permeate the market as it has in the past, it could cause a “break” in the market and force mills to cut prices dramatically to even things out, as they have in the past. Until then, distributors are already offering beams with the specification ASTM A992, W10 x 10, W18 x 6, and W24 x 7 at $39.00 cwt. ($780/nt or $860/mt) ex-mill.
As for imports, demand remains lackluster after a glut of beams arrived in US ports in November. According to US import license data, 51,212 metric tons of beams arrived into the US last month, marking the largest tonnage level since October 2012. Since demand for beams in the US has not made much of a dent in distributors’ existing inventories, most see no reason to book new orders for the time being. Offer prices have not moved much from the range of $34.00-$35.00 cwt. ($750-$772/mt or $680-$700/nt) DDP loaded truck to the Gulf Coast from Spain and Korea, although traders anticipate prices to start upticking soon once US construction activity shows stronger, steadier growth.