Darling to WAFD: Steel Prices to Remain Up for Next 6 Months

John Wolz

Steel prices will “remain strong and are expected to continue a slow increase for the next six months,” Bruce Darling advised the Western Association of Fastener Distributors. Zinc prices also will remain high, he added.

“Steel prices aren’t going down anytime soon,” Darling, vice president for materials at Porteous Fastener Company, predicted.
Darling showed how low carbon cold headed quality steel prices from China Steel Corporation of Taiwan rose from $300 per metric ton at the beginning of 2002 to $570 by the second quarter of 2005. In the fourth quarter last year China Steel Corporation’s price went down 5.3%, followed by a 10.7% decline in the first quarter of 2006. But prices have risen in the past three quarters and are now 91.3% higher than at the start of 2002.

Darling, who has visited plants in China, India, Taiwan, Thailand and Vietnam this year, noted that steel prices may vary elsewhere and types and grades of steel do not necessarily follow low carbon prices, but “long term they move reasonably close together.”

Noting that steel was about $500 m/t in the mid 1980s, Darling pointed out that today’s prices represent a return to those levels rather than new peaks.

Bao Steel in China also increased prices in the first half of 2006.
Darling reported Bao’s steel prices “might soften a bit in the last half of 2006” while CSC announces a 6.7% increase for the 4th quarter.

Also affecting steel prices are producers taking furnaces offline for maintenance, creating shortages. CSC will take its only wire rod billet mill offline for maintenance and that will reduce fourth quarter supply 20%, Darling reported. E-mail: bruced@porteousfastener.com
Editor’s Note: Bruce Darling will be speaking on “The Rapidly Changing International Marketplace,” at a Western Association of Fastener Distributors conference November 15, 2006, in conjunction with the National Industrial Fastener Show/West in Las Vegas. Web: wafd.org
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