Buyers in the US sheet market are putting off placing orders until after the July 4 holiday or potentially longer, market sources said Monday, because they are looking for more signs of market direction.
The Platts daily hot-rolled coil and cold-rolled coil price assessments remained flat on Monday at $625-$635/st and $820-$840/st, respectively. Both assessments are normalized to an ex-works Midwest (Indiana) basis.
"I think a lot of people loaded up on orders around mid-May in a bit of a panic based on where it looked like prices and lead-times were heading, but things became very quiet shortly after," a service center source said.
The market was confused by some of the price increase announcements disseminated last week, he said, and he did not think mills were selling a lot of steel at current pricing levels. He said he placed a small order for HRC at $630/st ex-works.
Another service center source said that inventories were low, but said purchases would resume when buyers feel assured prices would not slide. He also said he had been "preaching" to mill representatives to not panic, as the lull in activity is typical for July and August business.
Prices would likely decline slowly, another buyer said, adding that HRC prices had come down $5-$10/st from three weeks ago. "Your August [rolling] price is going to be a little cheaper than your July price," he said. "I think the same is going to hold true in September. September is going to be cheaper than August -- but not a lot."
The latest HRC spot price he received was $620/st, though that was before the price increase announcements.
Despite sensing general market weakness, he said mill supply was still tight and producers were holding customers to contract minimums where they could. "We're still being asked to stay within our volume agreements. We were able to get a little more than our minimum, but we had to appeal to get it," he said.
Another service center source said he has been out of the spot market for a while, but plans to start looking to take a larger position in 30 days.
