Integrated producers may have hit a cost floor on sheet products, and an increase is looking more and more likely, market sources told Platts Thursday.
"We're at the point where these mills are going to be at their breaking point or their cost," said one Midwest service center executive. "We'll call it an actual floor instead of a market floor."
The executive added that a large top-tier mill may be posting an increase as early as Friday.
An increase will primarily "increase interest" with non-automotive buyers, he said. Market sources have been reporting low service center buying rates due to market uncertainty and the expectation of an increase.
The impetus for an increase is further likely to come from an integrated producer, he said, because mini-mills are "content to sit back and devour all these orders at the integrateds' expense" due to moderate scrap costs.
Even so, a second service center source said, a majority of mini-mills can be expected to support an integrated-led price increase.
"I just know that everybody felt that [the market] was at bottom," he said. "And I think everybody wants to raise prices, they just didn't have a good enough reason. Everybody wants to make money."
Platts maintained its hot-rolled pricing at $630-640/st and its cold-rolled pricing at $750-760/st. All prices are normalized to a Midwest (Indiana) ex-works basis.
