The Nucor Sheet Mill Group announced an increase on base prices for new orders by a minimum of $40/nt ($44/mt) on hot rolled, cold rolled and galvanized sheets on Wednesday.
Nucor has gradually increased prices over the past three months in line with five price hikes announced by US mills equating $180-190/nt (198-209/mt).
Market participants were expecitng a price increase announcement sometime in mid-January supported by higher scrap prices pursuant to January trades settling up $20-30/gt ($20-30/mt) compared to the previous month. But the announcement was made earlier than expected.
Traders in flats products have expressed concern that while scrap prices have increased $80-90/gt ($88-99/mt) over the past three months demand in the sector is still weak. January’s positive sentiment and replenishment of inventory by end users and metal distribution centers is expected to help support the price rise in the short-term but participants are questioning the longer-term sustainability unless fundamentals strengthen.
Prices for hot rolled coil (HRC) were reported down 24pc from about $750-760/nt ($827-838/mt) in January 2019 to $570-580/nt ($628-639/mt) in early January 2020—a range that was last seen during the same period in 2010.
Prices in the upper $500s/nt range that were prevalent in the US domestic spot market from June-September 2019, decreased to the lower $500s/nt in October and November and began to gain momentum in early December supported by the price increase announcements.