SMU Price Ranges & Indices: Prices Slip & Slide

Frustration appears to be running high as buyers and sellers try to hold on to the gains (or to the floor) made a few weeks ago.

Despite their order books being weak, domestic mills do not seem willing to go below (or in many cases match) their previous deal. However, if they are not willing to move it seems many companies are not willing to buy. Inventories are imbalanced and service centers/distributors are selling like they are desperate to generate orders. In fact, most mill “deals” over the last 60-days have just been passed along to the end user which has only lead to margin compression and decreased value to existing inventories. In such a large and powerful industry one would expect steel mills to control pricing, but instead the market is currently being driven by the lowest common denominator. Until lead-times extend we should not expect the mills to have any control over the equation.