![]() That surprised me at the time because $500s/ton is getting close to breakeven for integrated mills, especially once you consider that contract prices are done at a discount to spot prices. Notable was that nearly 20% thought they would go above $700/ton while another roughly 20% predicted they would fall into the $500s/ton. About 60% of people thought prices would remain roughly where they were. (Note: Plate mills were more willing to negotiate lower prices because Nucor, a leading plate producer, announced a $140/ton price decrease.)īefore sheet mills announced price increases, forecasts were divergent. ![]() Figure 2 provides a quick snapshot of price expectations before and after the price hike announcements. Longer lead times and fewer mills willing to cut deals comes after a round of $60/ton ($3/cwt) price increases announced by mills in the U.S. Recall that for several months, nearly all producers were willing to discount to bring in orders. A 4.4-week lead time doesn’t mean higher prices are a slam dunk, but the chances of prices increasing go up considerably if we start to see HRC lead times averaging five to six weeks.Īlso, mills are less willing to negotiate lower prices than they had been in prior weeks. Lead times can be an important advance indicator of pricing moves. Hot-rolled coil (HRC) lead times, for example, had been slightly below four weeks on average they’re now at 4.4 weeks (see Figure 1). On a basic level, that’s because we’ve seen a modest increase in lead times-which are up by an average of 0.5 weeks recently. We’ve also seen more people predicting higher prices in the months ahead. ![]() Steel sheet prices have bottomed or soon will, according to most respondents to our latest Steel Market Update (SMU) surveys. Vladimir Zapletin / iStock / Getty Images Plus If steel prices are supposed to continue their increase in 2023, the manufacturing sector is going to have to demonstrate greater demand for steel than what was shown at the close of 2022. ![]()
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