US Steel Prices Rebound in August
US flat product steelmakers are bucking the seasonal price
trend, by pressing for a rise in local values, despite the summer lull in
activity. Domestic suppliers, in an attempt to stave off the threat of further
losses, introduced a series of list price hikes, during the July/August period.
Local mills had little option but to implement such measures, as they aimed to
recoup rising input costs.
Initially, buyers resisted the mills’ price hike initiatives. However, the steel
producers’ proposals helped to prevent further price deterioration.
Subsequently, selling figures started to move up, despite US steel demand
remaining steady, yet unspectacular. Automotive and construction activity is
below last year’s numbers. The pipe and tube sector is healthy – although this
product is exposed to high import penetration. Energy-related consumption is
growing, albeit from low levels.
Domestic capacity utilisation, in the US, is approximately 81 percent,
year-to-date. Mill delivery lead times remain relatively short, despite the
impact of the summer outages for scheduled maintenance. Finished steel import
volumes rose markedly, in July, partly due to the removal of Section 232 tariffs
on neighbouring Canada and Mexico.
Consequently, many US buyers speculate that the recent pricing revival is likely
to be short-lived. It is widely acknowledged that few market fundamentals,
support a prolonged reversal of fortunes.
MEPS - International
Steel Review - August 2019
Free Sample copies
of MEPS Reports
up for free MEPS steel news alerts