The US sheet steel market remained stable but sluggish Monday as buyers sought price direction following last week's Thanksgiving holiday.
One buyer said he believes the hot-rolled base price is at or close to bottom at about $630/st. Thickness extras, freight and other ancillary items are being discounted to keep base prices firm, he said.
"How much does it cost -- hypothetically -- to slow down a mill to run 16 gauge [coil] when it's not full?" he said. "The whole expense is time on the mill -- but if the mill is running low, there's no real expense. Maybe a little roller wear, but that's hard to quantify as well. Those are free things to give away and make a deal."
An overall lack of market activity is contributing to the relatively level coil pricing environment, he added.
"It's quiet today, but it was quiet last week, too," he said. "Some of that was the holiday, but a lot of it is still people sitting on their hands looking for direction, and I don't think anybody knows that."
One Midwest service center executive said he and some of his professional contacts have heard that a $40/st flat-rolled increase could be announced "in the next week" by a top-tier mill.
The rationale for such an increase appears weak due to lead times and raw material costs, but at least some mills are counting on a strong first quarter, he said.
A buyer on the West Coast said some Midwestern mills have been sniffing around for business due to their weak lead times, but freight costs and attractive import pricing are limiting their opportunities.
"They have a little more interest right now because their lead times are so short, but it's still hard to buy from those guys," he said.
Platts held its hot-rolled assessment firm Monday at $630-650/st and its cold-rolled assessment at $755-765/st. All prices are normalized to a Midwest (Indiana) ex-works basis.
