Tag Archives: US

US Coil Prices Soften, Plate Values Steady

US strip mill product prices fell, in the past four weeks, according to MEPS. Hot rolled coil is readily available, from both local and offshore suppliers. Domestic delivery lead times are between two and four weeks. A number of US steel buyers remark that local producers and several Canadian steelmakers continue to offer material at slightly reduced price levels, in an attempt to secure orders.

Cold rolled coil buyers were successful in securing discounted deals from domestic mills – after achieving price reductions on hot band material. Many US producers lowered prices, in an attempt to secure orders, amid stronger foreign competition. Small pockets of material from Russia, Egypt, Canada, Mexico, South Africa, Malaysia and Thailand are available in the domestic market.

Demand from the automotive sector has slowed down, albeit from record levels. Local hot dipped galvanised producers are willing to offer reduced prices, in an attempt to secure orders. Delivery lead times are between five and seven weeks. A shortage of competitively-priced offshore options persists.

The upward trajectory of US hot rolled plate prices stalled, as local values were unchanged, this month. However, the domestic mills could announce a list price hike, in the near term. Healthy demand from the construction and energy sectors and tight supply conditions could assist mill attempts to solidify previous price gains. Domestic delivery lead times are projected to extend, in the third trimester, as several US plate producers plan maintenance outages. Availability of offshore hot rolled plate remains limited as a result of trade cases.

Source: MEPS International Steel Review – May 2017 Edition

GLOBAL STEEL PRICES CONTINUE TO SLIDE IN DECEMBER

International steel prices remained under pressure, in December, due to sluggish global demand and high inventories.

In the recent issue of the International Steel Review, MEPS reported that world steel prices slipped further across flat and long product areas.

In North America, flat prices continued to weaken amid lacklustre demand domestically while a strong US dollar hampered exports. Buyers are delaying purchases as they prioritise their year-end stock positions.

Chinese spot prices have reached record lows with local producers selling excess stock at discounted prices. With demand slowing down domestically, China continues to pitch its exports at remarkably low prices. Subsequently, steel mills have cut domestic selling values in Taiwan and South Korea.

However, US flat prices may have bottomed out as many domestic steel mills have announced price increases for the first quarter. At this stage, it is unclear whether the price hikes will be accepted by the market.

Source: MEPS International Steel Review – December Issue

INTERNATIONAL STEEL MARKET ROUNDUP FROM MEPS

World steel prices have plummeted by 28 percent in the past twelve months, according to MEPS.

In November’s release of the International Steel Review, MEPS reports that international market activity for both flat and long products is weak as the influx of Chinese material continues to put downward pressure on global steel prices.

We have noted that Chinese export prices are at record lows. This, along with falling raw material costs, has enabled buyers in Taiwan and South Korea to secure reductions in their local market.

There is growing evidence that European steel mills are looking to fill spare capacity but activity is slow amid market uncertainty in the energy and construction sectors.

In the US, short lead times are being offered by producers as buyers delay purchasing decisions due to falling steel prices. Customers are prioritising their year-end stock positions.

Furthermore, buyers worldwide are expecting further steel price falls with little sign of a market pickup heading into the new year.

Source: MEPS – International Steel Review

Klöckner & Co acquires US sheet metal fabrication company American Fabricators

  • Highly profitable company with annual sales of around USD 30 million
  • Entry into sheet metal fabrication as next strategic step following expansion of service center activities
  • Higher value-added depth and greater integration into customers’ production processes

Duisburg, Germany, October 1, 2015 – Through its US country organization Kloeckner Metals Corporation, Klöckner & Co has acquired the US sheet metal fabrication company American Fabricators based in Nashville, Tennessee/USA.

American Fabricators specializes in the professional fabrication of sheets into complex parts for customers from a wide range of different industries. The company operates state-of-the-art machinery on production facilities spanning some 10,000 square meters. With around 150 employees the highly profitable enterprise generates annual sales of around USD 30 million. The parties agreed not to disclose the value of the transaction. Consolidation will take place from the start of the fourth quarter of 2015.

“Having expanded our service center activities in the US to a significant degree, we are now entering the higher value-added segment of sheet metal fabrication. This means that through greater integration into our customers’ production processes, we will be participating more and more from value creation in the manufacturing of complex sheet metalcomponents. In this regard, the acquisition of American Fabricators not only marks a milestone in implementing this strategy in the south-east of the US. The process expertise gained can also be channeled into creating value in other regions of the US and even at European locations,” says Gisbert Rühl, CEO of Klöckner & Co SE.

Source: Klöckner & Co

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MEPS – GLOBAL STEEL PRICE RISES IN MAY FOR THE FIRST TIME IN TWELVE MONTHS

US strip mill product transaction prices have firmed, following recent price hike announcements by all the major producers. The mills appear to be quite disciplined about the implementation of the increase. Moreover, delivery lead times are slowly extending and the threat of trade cases against overseas suppliers has made buyers very cautious regarding booking foreign material. Distributors, who still have plentiful stocks, continue to reduce inventories.

Canadian mill activity is still poor, with short delivery lead times. However, import volumes are drying up as domestic prices become more competitive. Market participants believe that transaction values have now reached the bottom. Service centre sales are steady, but sluggish for the time of year. The high priced stocks that all distributors are carrying are weighing heavily on resale values.

Cheap iron ore continues to undermine market prices in China. Demand from the property market, auto, shipbuilding and appliances is weakening. The People’s Bank of China recently made its third interest rate cut in six months in order to support the economy. Major steelmaker, Baosteel, has left its official ex-works list prices, for the June delivery of most flat products, unchanged from the previous month. June is typically a slow season for the Chinese steel sector.

In Japan, inventories of flat rolled products are still in surplus. Several large steelmakers will cut output, in the April/June period, to try to rectify the situation. In March, shipments of carbon steel finished products were at their highest level for two years but the rise was purely due to better export volumes. Domestic deliveries actually fell. Although overseas business is brisk, export prices continue to tumble. Import volumes, in March, fell 33 percent to the lowest point since September 2013, partly due to the weak yen, but also because of less healthy levels of consumption.

South Korean steelmakers are concerned about the high volumes of low-cost Chinese material entering their home market, even though steel imports shrank by over 8 percent in April from a year earlier. The main reasons for the contraction were slumping demand and climbing inventories. The economic recovery remains lethargic. In addition, more recently, Russian offers to the Southeast Asian market have disrupted South Korean exports to that region.

Chung Hung Steel, one of Taiwan’s major flat product re-rollers, announced lower list prices for May contracts, compared to the figures published for April. The cuts were a similar magnitude to those previously announced by major integrated producer, CSC, for June. Marketplace transaction figures have mirrored the move. Sales remain weak amidst stiff competition from cheap imports.

In Poland, strip mill product prices are stable. Buyers do not believe that significant increases are possible in the present climate. Consumption is reasonable but imports continue to take up a large share of the market. Czech/Slovak transaction values have softened slightly, despite improvements in the economies of both countries. Market sentiment has certainly revived amongst many Czech manufacturing companies due to the weakness of the currency, cheap energy and recovering domestic demand. There is less competition from Ukrainian steel mills as their output has been curtailed by the political crisis in that country.

Flat product numbers are generally unchanged in Western Europe, although we can detect a little negative pressure in certain countries. Activity is picking up, albeit slowly, as the economic climate improves. Some steelmakers have decent order books. However, their raw material costs remain low, providing them with limited backing to lift selling prices. Many third country producers continue to reduce flat product price quotations. Buyers are beginning to show more interest, although, much of this material would be arriving in the holiday period.

Source: MEPS International Steel Review – May Issue

DOWNTREND IN MEPS GLOBAL STEEL PRICE PERSISTS

US flat product transaction values have shown a steep decline over the last month, in the wake of high volumes of cheaper imports and overblown service centre inventories. Domestic mills, experiencing a notable lack of orders, have started to compete on price with overseas suppliers. Dropping mill input costs are softening the blow for some steelmakers. Distributors are purchasing very cautiously as they watch transaction figures plummet. Their resale values are also tumbling as they offload excess stock.

Although auto activity is still strong in Canada, distributors are scaling back their order placement as they wait for steel prices to bottom out. Moreover, oil and gas related sales are declining. This, together with the falling outlay on input costs, has forced steelmakers to make substantial transaction price cuts.

The Chinese economy is showing signs of moderating growth. Steel orders have been cut due to slowing manufacturing activity. This has badly impacted steel prices, which have posted significant losses since MEPS December report. There have been a variety of views on the implications of the government’s decision to withdraw the VAT rebate on exports of some boron-added items. However, it seems likely that steelmakers are already looking to exploit other loopholes.

There is concern in South Korea about the growing volume of foreign steel arriving in the country. This material, as well as steel from domestic sources, continues to flood the market, weighing heavily on selling values, which have undergone further negative developments this month. Falling raw material prices are also driving figures down as customers call for discounts.

Taiwan’s integrated producer, CSC, reported declining sales revenue in November, compared with the previous month, but shipment volumes were slightly up in December. Downstream businesses, anxious about their ability to compete in global markets, have been ordering less. In the marketplace, flat product transaction values are falling.

In Poland, strip mill product prices have decreased when measured in euros. Buyers report that the lower figures are valid until the end of March, although producers are trying to talk them up. Business is quiet in the Czech/Slovak region, following the holiday. Steel demand is still at a low level but is better than a year ago. The mills have yet to make any official price announcements for 2015. Buyers do not believe they will ask for any rises, even in the second quarter. Service centres are purchasing cautiously because of tepid demand.

Source: MEPS International Steel Review – January Issue