While there is not much doubt that the $1.00 cwt. ($22/mt or $20/nt) transaction price increase announced last week for US domestic wide flange beams (WFB) will go through in full, it does not mean, however, that market prices will match the $42.00 cwt. ($926/mt or $840/nt) ex-mill published prices effective January 1, 2012. Sources tell SteelOrbis that mills are still selling WFB to major distributors at such a discounted price, that many smaller-scale distributors can buy beams from their larger counterparts cheaper than they could directly from the mill--by as much as $1.00 cwt. less than listed prices. Aside from the price factor, large distributor sourcing is more attractive because buyers can buy smaller, custom-sized tonnages to meet immediate needs instead of being forced to buy large inventory orders from mills. Despite mills losing smaller business to their own large customers, sources do not believe that mills will simply firm up their prices because in such a soft market, they are likely afraid of losing market share to competing mills.
At least US domestic mills don't have import competition to worry about. Distributors on both sides of the US have reported for months that they have no interest in imported material at the moment, and traders confirm that they don't even expect many inquiries moving into the spring stock-up season. Import prices, meanwhile, have declined in the last month, with offers from Spain dropping $1.00 cwt. on the low end to $38.00-$39.00 cwt. ($838-$860/mt or $760-$780/nt) DDP load truck in Gulf Coast ports and Korean offers also moving down $1.00 cwt. to $37.00-$39.00 cwt. ($816-$860/mt or $740-$780/nt) DDP load truck in Gulf Coast ports.