LOS ANGELES West Coast
producers of structural steel tubing continue their struggle to
implement higher prices in a market that, in many cases, has
splintered into two different levels.
Increases of $30 per ton that
producers tried to initiate beginning March 11 (
amm.com, April 1) were aimed at raising the price
of core sizes of A500 Grade B hollow structural sections (HSS)
in the Los Angeles market to anywhere from $980 to $1,000 per
ton ($49 to $50 per hundredweight). This appears to be holding
in daily purchases for spot requirements and replenishment of
holes in distributor inventories.
But the spread between these
day-to-day buys vs. consolidated purchases of at least a rail
car (about 90 tons) appears somewhat larger than normal,
reflecting a discount of $40 per ton ($2 per cwt) or more to
the day-to-day purchase price, market sources said.
"The mills are all trying to
support the increase," a service center buyer said. "But
theyre also being very frank in letting us know that, if
theres a big job, then all bets are off and theyll
Meanwhile, some said recent
South Korean offers indicate an effort by tubing mills in that
country to raise their export prices to the United States,
which earlier this year had fallen below $780 per ton ($39 per
cwt). But plenty of tonnage has already arrived at prices below
$800 per ton ($40 per cwt), which some local sources maintain
is undercutting the resale market here.
Observers point out that the
uncertainty is occurring amid continuing pressure on the prices
tube producers are paying for their coil feedstock, which has
declined by an estimated $20 per ton in recent weeks,
increasing the threat that these falling costs could reach
downstream tubing prices, according to market reports.
"Its going to take at
least a few weeks before we find out just where this tubing
market is settling," a market source said.