Trade Resources Industry Views Platts Maintained Hot-Rolled & Cold-Rolled Coil Assessments at $675-685/St & $775-785/St

Platts Maintained Hot-Rolled & Cold-Rolled Coil Assessments at $675-685/St & $775-785/St

ThyssenKrupp's early Wednesday update on the expected sale of its Calvert, Alabama, steel rolling mill has spurred hopes of even higher US sheet prices by the year's end, sources said.

Platts maintained its hot-rolled and cold-rolled coil assessments at $675-685/st and $775-785/st, respectively, Wednesday, with all prices normalized to a Midwest (Indiana) ex-works basis.

Those prices, however, could post a sharp jump should further news break on the Calvert mill, said one trader.

"When an announcement is made, there will be shockwaves," he said.

If the prospective buyer is a domestic mill, a combination of improved logistics, stiffer pricing discipline and the ability to throttle down outdated capacity elsewhere could immediately lift prices, he said. "I would not be surprised if the market was hit with a $40 increase the next day."

Several sources said the Calvert mill would likely be supplied with slab steel from Mexico and Brazil going forward, which might complicate the impact of the events involving the facility on the domestic market.

"Of course, the issue still remains, 'How do you supply that mill, and where do you get the supply from?'" a trader said, expressing relief that "we are getting to a point where we don't have to talk" about ThyssenKrupp's ownership of the plant any more.

The German steel and engineering group said Wednesday it is in "exclusive negotiations" with a potential buyer of the Alabama rolling mill.

But its Brazilian slab plant is not set to be included in the sale and ThyssenKrupp has not specified whether a potential buyer has been identified or if the company will retain control of the asset.

That said, the Calvert talks also involve discussions about a long-term slab supply contract for the Brazilian mill, a solution the company said would secure the value of the Brazilian facility.

ThyssenKrupp has been trying to sell its Steel Americas assets since May 2012 and had initially expected to have a deal completed by the end of its financial year on September 30.

The company said Wednesday that it was delaying the publication of its annual results, scheduled for Thursday, until December 2, when an announcement is widely expected.

Source: http://news.chemnet.com/Chemical-News/detail-2194185.html
Contribute Copyright Policy
US Steel Sheet Sentiment Improves After Thyssenkrupp Sale Update
Topics: Metallurgy