Just before one US domestic hollow structural section (HSS) tubing mill announced a steep $2.50 cwt. ($55/mt or $50/nt) price increase, SteelOrbis sources had confirmed that book price offers had dropped by $2.00 cwt. ($44/mt or $40/nt) week-on-week, from $38.50 cwt. ($849/mt or $770/nt), to $36.50 cwt. ($805-$730/mt), FOB mill.
"This is about getting everything in line before the [tube mills] announce an increase," a source said before Atlas Tube announced their increase, noting the strategy is likely tied to mills' desire to lengthen lead times. "Bookings in the last week have been robust, which isn't at all surprising. And since everyone agrees that scrap is going to come up next month, it's not a matter of if an increase will be announced, it's a matter of when."
Sources tell SteelOrbis that the increase will take a few days to digest. Booking activity has been robust lately at "blowout prices" as mills try to boost orders and extend lead times, one source said, and now that one US flats mill has announced a price increase, sources believe the tubing increase will likely gain traction, solidified further by scrap prices rising as predicted next month.
Although September scrap trading has yet to commence, SteelOrbis has learned that several "early trades" on shredded scrap have taken place at up $35/gt from August settled levels. Whether this is indiciative of where September prices will settle, or if these are early, pre-September-scrap-trade outlier transactions, has yet to be known.