Price Increases Take Base Prices to What Levels?

The market is weighing the latest attempt by the domestic steel mills to raise flat rolled steel prices. Virtually every mill has come out with spot market price increase announcements of $30 per ton on hot rolled, cold rolled, galvanized and Galvalume steels. However, there are a couple of mills that have very little spot business. These mills (US Steel, AK Steel) may have base prices higher than what is actually transacting in the marketplace.

A good example is AK Steel which announced specific base prices on December 9th which was their first increase in the current “up” cycle of pricing. They announced hot rolled base pricing at $420 per ton ($21.00/cwt), cold rolled base pricing at $540 per ton ($27.00/cwt) and galvanized base pricing at $550 per ton ($27.50/cwt). Since then they have made two announcements of $30 per ton each ($60 per ton total). So, if they were collecting all of their announced increases hot rolled should now be $480 per ton ($24.00/cwt), cold rolled $600 per ton ($30.00/cwt) and galvanized $610 per ton ($30.50/cwt).