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• Location of Shoot: ( Mumbai ) Home Magazine Nucor-Yamato, Nucor keep beam prices flat
Nucor-Yamato Steel Co., Blytheville, Ark., and Nucor Corp.s Berkeley, N.C., beam mill have both notified customers that they will not change either their raw material surcharges or published transaction prices next month. The decision to hold prices steady comes after AMM left the consumer buying price for shredded automotive scrap in the Chicago marketa key component in Nucors surchargesunchanged at $386 per ton (amm.com, Jan. 7).
Although buyers said midday Friday that they had yet to hear from the Columbia City, Ind.-based structural and rail division of Steel Dynamics Inc. and Tampa, Fla.-based Gerdau Long Steel North America, they largely expect the producers to follow Nucor-Yamatos and Nucor Berkeleys lead. It will be the third straight month that the f.o.b. mill price will be listed at $780 per ton ($39 per hundredweight) for most core sizes.
Buyers report that mills are mostly continuing to honor their published prices in day-to-day business, in contrast to much of 2012 and the preceding several years when discounting was commonplace in order to compete with both imports and each other in a post-2008 environment of lagging demand. Although buyers said mill sales representatives in some cases appear eager to make deals, especially with some producers reportedly holding substantial floor stock, most mills appears determined to hold the line.
"Right now, theres more pressure on the upside of prices than on the downside," said a beam buyer on the East Coast, citing what he sees as a likelihood that scrap and iron ore prices could rise over the next month or two.
However, downward pressures on distributor resale prices havent disappeared completely, particularly in some import-sensitive regions, according to market observers. On the West Coast, for example, one or two large service centers reportedly have tied up the largest share of South Korean beam imports in the first quarter at ex-dock costs estimated in a range of $740 to $750 per ton ($37 to $37.50 per cwt) compared with estimated delivered costs for domestic beams at $870 to $890 per ton ($43.50 to $44.50 per cwt). Competitors grumble that, even though these service centers also are buying domestic beams, low-priced imports allow them to bring the blended cost of their inventories down below their rivals and establish a resale price level where others struggle to turn a profit.
"This can make it nearly impossible for us to buy only domestic material and sell it competitively," a rival service center buyer said. Have your say