The US sheet steel market might be in for another stretch of relative stability, as new upcoming outages balance import pressure and drab demand, market sources said Thursday.
One industry consultant said manufacturing -- and thus steel consumption -- should perk up a bit in the second half of the year, but "lower raw material prices, higher utilization, and higher imports may cap the upside at something less than $700/st," he said.
"Probably the best outcome would be a 'steady-as-she-goes' scenario, thus avoiding price volatility -- and that seems to be the case today whether one talks about base metals (other than nickel), ferrous scrap prices, or even equities," the consultant said.
A Southern buyer pegged the prevailing hot-rolled coil price at about $680/st, with both pricing and demand stronger in the Southern market.
Upcoming outages at both US Steel and ArcelorMittal may help "stop the bleeding," he said, but aggressively priced Chinese imports and settling demand are likely to keep pricing moribund unless demand turns a corner.
"I don't know if it's substantial enough for them to start kicking prices back up," he said. "But it should have somewhat of a positive effect on prices."
A second buyer said he is seeing hot-rolled slightly weaker at about $33.75/st, particularly from mills with already comfortable order books.
However, he discounted reported sub-$660/st prices heard earlier this week for significant tonnage.
The upcoming outages, while a net positive for the industry and a counter to returning capacity, are not likely to move near-term pricing, he said.
"Supply coming back [from the unplanned outages earlier in the year] isn't a July issue," he said. "People are making money, [so] there's not much of an incentive for it to move."
Platts held its hot-rolled assessment firm at $680-690/st and its cold-rolled assessment at $810-820/st. All prices are normalized to a Midwest (Indiana) ex-works basis.
