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US sheet prices rising, but vary by mill - 22 August 2011

US spot sheet prices appear to be rising in the wake of recent mill hikes and talk that a second round of increases could be coming, <b>Steel Business Briefing</b> learns.

However, buyers tell SBB and sister publication, <i>Platts Steel Markets Daily</i>, list prices vary significantly by mill. They've seen hotrolled offers ranging from $690/s.t from AK Steel to $700/s.t from RG Steel and Severstal, and $720/s.t from Nucor, all fob mill.

A number of mills announced $60/s.t spot increases earlier this month, when HRC was about $630-640/s.t. Coldrolled and hot-dip galvanized prices remain around $760-800/s.t and $790-840/s.t, respectively.

One distributor says recent offers have been "all over the place," and overall transaction prices are higher than prior to the recent hikes. Still, while most producers he's spoken with have asked for the full $60 increase, they've been willing to negotiate.

"The mills I have done most recent business with were more willing to come off that increase," he says. "I think new business will be offered at the high end of the spectrum and residual business in the lower end. I think the market still needs more time to find out what is the real number."

One midwestern US source says he's also seen wide price spreads between mills, but doubts they're getting all of the $60 hike. "So far, I think some of the increases are sticking, though it will take more time to better understand how much," he says.

A southern stockist says the recent price hikes "are just a smoke screen," as "stockists and end users alike are not taking any risk at current book numbers… Any substantive buying today would probably be at your numbers listed by AK or below," he says.

Another southern stockist says he's seen higher offer prices recently, but talk last week that at least one mill is mulling yet another increase likely mean producers are simply trying to solidify their first round of hikes. "That's a play that's obviously been used when there's no demand – don't retreat on the price, take it up again," he says.


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