After the fourth increase announced this year, prices for domestic hot-rolled coil in Brazil grew slightly during the first week of November, market sources have reported.
A source from the distribution sector said after CSN and Usiminas announced their hikes in the past weeks, ArcelorMittal finally communicated to its clients about the new price list it released on November 1.
"The three biggest mills are now working with new price lists. But, we know: they announce, start applying the new values but, depending on the negotiation, they delay the implementation of the new prices," the source explained. "I have heard of deals with new prices only after November 15; other that will receive the adjustment only in December."
An end-user reported a similar situation with his negotiations.
"I closed deals in late-October with the old prices," he said. "For November and December, I will suffer no change in prices. I will only be hit by this new wave of price hike in January, but I keep on trying to get discounts.
A third source -- a trader -- affirmed he saw this adjustment as "necessary due to the higher cost with coal but not sufficient to cover the hike in costs."
The trader added with the new price hike the domestic product has a premium of around 13%-15% over the imported material.
"These levels are a bit high, but if the international prices continue getting stronger, the levels will adjust to healthy stages," he said.
Brazil's domestic mills do not comment about their pricing strategies.
S&P Global Platts' weekly HRC assessment was up Real 40/mt to Real 2,175 based on a range of Real 2,100-2,280/mt ($652-$708/mt) ex-works, excluding taxes. Last week, the range was Real 2,050-2,250/mt (mid-point Real 2,150/mt). The currency exchange on October 7 was $1/Real 3.22.
