Steel Mill Negotiations: More Hold the Line

Buyers of flat rolled steel report that more mills are holding the line on pricing following the price increases announced earlier this month. Mill order books are firm and there’s no negotiating for a better price, according to 28 percent of respondents to SMU’s latest steel market questionnaire. About 22 percent say they still find most mills willing to talk price, even after the recent price increase announcements. The other 50 percent call the market mixed, with some mills firm and others flexible. “It depends on the item,” said one service center executive. “Lead times are all over the place, from late January to early March ship dates,” commented another.

By market segment, 60 percent of SMU respondents say the mills are holding firm on hot rolled steel orders, while only 40 percent report they’ve found mills willing to negotiate. That compares with 47 percent who said mills were holding the line earlier in December and 53 percent who found mills willing to negotiate. One has to look as far back as July to find a month when the majority of steel mills were unwilling to talk price, which suggests that HR demand is unusually strong to end the year.