SMU Data and Models
April 30, 2020
Steel Mill Negotiations: Buyers Still Have Leverage
Written by Tim Triplett
On Monday of this week, Steel Market Update began canvassing the markets as we conducted one of our flat rolled and plate steel market trends suveys. The vast majority of the responses were received early in the week and the results of those responses are presented below. However, SMU continued to speak directly to both buyers and sellers of steel as the week progressed, and we found the market changing from Monday to Thursday. What we picked up today was a not in sync with what we are going to show you below. Steel mills have begun to move off the bottom feeding steel price numbers, and are becoming more aggressive. This caused us to change our Price Momentum Indicator to Neutral earlier today.
The negotiations data from Steel Market Update’s canvass of the market this week shows that buyers still have most of the leverage when it comes to negotiating prices on spot orders of all types of steel products. Roughly nine out of 10 buyers responding to SMU’s questionnaire said the mills still remain flexible on price as they compete to win the limited orders up for grabs in a market disrupted by the coronavirus.
