Steady trend in flat steel buying activity in US markets: MEPS
LONDON (Scrap Monster): The US market for hot rolled coil (HRC) and cold rolled coil (CRC) steel products is appearing to be steady in early 2012 with HRC selling figures climbing approximately four percent , month-on-month in February, according to MEPS International Ltd.
The first quarter is sold out at many US strip mills and distributors expect demand to continue at a good level through March and April.
Commodity plate prices have held at the inflated levels achieved in January. Demand is strong from a number of end-user sectors such as mining, barge work, and transmission pipe and wind towers. However, consumption by the construction industry remains poor.
With delivery lead times for cold rolled coil stretching towards eight weeks, US mills proposals for higher transaction values have succeeded once again. MEPS selling figures have risen over 3 percent since January. However, buyers are cautious about rebuilding stocks at a time when scrap prices are softening which suggests the positive price tendency may now be coming to a halt.
Sales forecasts for auto and domestic appliances are encouraging for the year ahead and coated steel demand from those sectors remain firm. The advances planned by US steelmakers for February have been accepted but further hikes next month are unlikely.
Some further modest upwards movement in US transaction values is possible in the near term because demand is likely to remain firm through March and April. However, cheaper foreign imports are expected to arrive at the docks in the spring which could adversely affect domestic prices in the second quarter of 2012.
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