Monday’s $10 per net ton ($11/mt) base price increase by Nucor for its domestic hot-rolled coil (HRC) is seen by some market insiders poled by SteelOrbis as an attempt by the US steelmaker to establish a price floor under falling steel prices, as even as US domestic steel prices continue to decline amid scant mid-May demand.
Since Nucor’s Consumer Spot Price (CSP) -the base price offered for all of its producing mills- was established in early April, the weekly CSP had declined nearly 10 percent before yesterday’s price increase, and the lower Nucor pricing was largely tracking the trend seen in daily spot markets.
Monday’s announcement by Nucor increased its CSP to $38.50 cwt ($848/mt or $$770/nt). Nucor’s California-based CSI base price was unchanged from the week prior at $42.00 cwt ($926/mt or $840/nt). Lead times for all spot orders are offered between 3-5 weeks, Nucor said in its weekly announcement to customers.
“The lower scrap values that we’re seeing doesn’t bode well for the price increase at Nucor,” a contact told SteelOrbis, hinting that (the prices increase) might be an attempt to establish a price floor under falling prices.
SteelOrbis price polls find the outlook for June scrap values at sideways to lower versus the May pricing seen during the monthly buy cycle. US domestic containerized shredded scrap is discussed $10/nt ($11/mt) less this week at $390/nt ($430/mt), market insiders told SteelOrbis.
“Overall, US Midwest scrap is flat to down $10/nt ($11/mt) from prices seen in early May,” another scrap trader told SteelOrbis. “We’re seeing slack demand and very plentiful supply,” he continued, “For June the outlook we’re hearing is that people are leaning sideways to lower.”