Late yesterday afternoon, Nucor Sheet Mill Group announced that they too will be raising US HRC base prices. And while the Cliff’s announcement established a new, minimum HRC base price of $57.50 cwt. ($1,268/mt or $1,150/nt), FOB mill, Nucor simply announced they’ll be raising prices by $2.50 ($55/mt or $50/nt) effective with all new orders.
Sources have indicated that this weeks’ HRC pricing is trending at $52.50-$54.50 cwt. ($1,157-$1,202/mt or $1,050-$1,090/nt), FOB mill, which is up by $0.50 cwt. ($11/mt or $10/nt) since mid-November. This range is “just a hair short” of the minimum $55 cwt. ($1,213/mt or $1,100/nt) HRC base price set by Nucor in their last announcement.
CRC and HDG prices, on the other hand, are “mostly stable” and are still being heard at roughly $64-$66 cwt. ($1,411-$1,455/mt or $1,280-$1,320/nt), FOB mill.
What’s most interesting about this week’s increase announcement is that despite the fact that flats mills are still pushing for higher sheet prices, it appears that mills are going to push to take scrap prices down during this month’s buy cycle.
Yesterday, SteelOrbis reported that numerous mills sent out a rash of scrap order cancellations for December bookings that had yet to be delivered, and today, a Detroit-area mill kicked off this month’s scrap trade when they came out at down $20/gt for shredded and P&S, and down $50/gt for busheling. A Chicago-area mill followed shortly thereafter at those same pricing levels.
Other mills have yet to announce.
If scrap does settle down during this month’s buy cycle (additional clarity on that will not be available until early to mid-next week), flat rolled buyers say they’re skeptical that the latest increase will gain traction.
“I don’t think mills are selling much at $55 cwt. ($1,213/mt or $1,100/nt), FOB mill and they definitely aren’t selling above that,” one source said, adding that he’s seen some HRC lead times cycling back toward 4 weeks, with some mills still having availability for end-of-January delivery.
“I think there’s some fluff to the market, but let’s see how order placement looks with everyone coming back from the holiday,” he continued. “If there is anything I have learned over the years, is that there’s no point in trying to read the market between Christmas and the start of the New Year.”