Steel Mill Negotiations: Mills Still Have the Leverage

There is very little negotiation going on between the mills and their spot market customers as supplies remain extremely tight and buyers are happy just to find available material, even if they have to pay a substantial premium. It has been a seller’s market since September, with the mills enjoying most of the leverage, and there are no signs of that dynamic changing anytime soon.

Data from Steel Market Update’s market trends questionnaire this week shows only minor changes since the last survey in late November. The vast majority (94 percent) of the steel buyers responding this week said the mills are unwilling to deal on hot rolled. Only 6 percent said the mills are willing to bargain to secure an HR order. In the cold rolled segment, 93 percent of those responding said the mills see no reason to talk price.