Overall Mill Negotiations Rate Falls, But Plate Surges

Jan 24, 2024

SMU Data and Models

Written by Ethan Bernard

August 31, 2023

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The overall steel mill negotiation rate slipped this week, though plate jumped, rising by 25 percentage points, according to SMU’s most recent survey data.

The percentage of respondents saying steel mills were willing to talk price on plate stood at 82% this week, up from 57% two weeks earlier, while all the sheet products SMU surveys notching declines.

Every two weeks, SMU asks steel buyers whether domestic mills are willing to negotiate lower spot pricing on new orders. This week, 76% of participants surveyed by SMU reported mills were willing to negotiate price on new orders, down four percentage points from two weeks earlier (Fig. 1). The last market check marked the first time the reading cracked the 80% mark since late June.

Fig. 2 below shows negotiation rates by product. Hot rolled fell one percentage point from two weeks earlier to 89% of buyers reporting mills more willing to negotiate price; cold rolled stood at 84% (-2 pts); galvanized at 90% (-5 pts); and Galvalume at 34% (-41 pts). Recall that Galvalume can be more volatile because we have fewer survey participants there.

Here’s what some survey respondents had to say:

–“(Willing to negotiate on plate), depending on grade and size.”

–“UAW possible strike is an unknown risk.”

–“ With tonnage you can get sub-$700 price (on HRC).”

–“ Very few large transactions (on HRC) received. Those that were, at numbers sub $750.”

Note: SMU surveys active steel buyers every other week to gauge the willingness of their steel suppliers to negotiate pricing. The results reflect current steel demand and changing spot pricing trends. SMU provides our members with a number of ways to interact with current and historical data. To see an interactive history of our Steel Mill Negotiations data, visit our website here.

Ethan Bernard is a reporter and editor for Steel Market Update. He previously worked for American Metal Market as a copy editor in the New York office for two years starting in 2008. Later, he copy edited AMM’s monthly magazine on a freelance basis from 2015 until 2017. With experience in financial copywriting and textbook publishing, he holds a BA in Comparative Literature from UC Berkeley, and an MFA. in Creative Writing from New York University. He can be reached at [email protected] or 724-759-7871.

SMU's Current and Future Steel Buyers Sentiment Indices both edged down this week, based on our most recent survey data.

This year, the 13th annual edition of our Summit, we polled more than 1,450 attendees about where prices and demand would be, come August 2024.

Steel Market Update’s Demand Index remains in contracting territory, where it has been for most of the last four months, according to the latest survey data. While the market did react temporarily in response to mill price hikes in mid-June, apparent demand for flat-rolled steel in the US continues to trend down.

The latest SMU Market Survey results are now available on our website to all Premium members.