[ferro-alloys.com]US flat-rolled steel prices were largely unchanged Wednesday as at least one US mill was looking to increase sheet prices, according to market feedback.
The daily Platts TSI US hot-rolled coil assessment rose by 75 cents Wednesday to $835.50/st, with the daily Platts TSI US cold-rolled coil assessment calculated at $935.75/st, down $1.75/st from Tuesday.
On Wednesday morning, Nucor notified customers it intends to raise sheet prices by $40/st, effective with new orders, marking the first formal sheet price increase announced by a domestic producer since the first quarter (See story, 1332 GMT). Other US mills were expected to follow the increase, sources said.
Buy-side sources said it was too early to tell if Nucor's announcement would lead to higher pricing, but the move was expected to establish a floor for weakening sheet prices which have been falling in recent months since hitting a peak of $920/st in July.
"This is the increase that sets the tone with buyers that it is not getting lower," a service center source said. However, he noted that some mills will still likely sell at a discount in the near term to improve their order books.
As many buyers have been sitting on the sidelines, steps taken by mills to try to increase prices could help to spur more buying activity in the spot market, sources said.
A buy-side source said that while he was expecting mills to try to raise prices, he said he was not convinced the increase would get much traction. A second service center source reported their spot offers had already increased $30/st Wednesday compared with what they were quoted last week.
"Depending on how buyers react, it will set the tone for the next increase, which will be meaningful," the first service center source said. He was expecting mills to be targeting HRC pricing at a minimum of $840/st going forward.
Lead times at domestic sheet mills were largely unchanged on week, with current HRC lead times at an average of 4.2 weeks, down slightly from the 4.3 weeks reported on October 3. CRC lead times moved slightly lower to 5.5 weeks, down from 5.6 weeks, while average hot-dipped galvanized sheet lead times were unchanged on week at 5.9 weeks, according to S&P Global Platts data.
"I think with the activity we are seeing and hearing about, this first increase will unleash some activity that will make mill order books look better than they probably should," the first service center source said. "Lead times should move."
The combined Platts TSI price index uses a volume-weighted average calculation -- according to TSI's standard -- to determine value on an ex-works Indiana basis.