Falling raw material prices may be cushioning the blow to US mills’ bottom lines, but it’s not enough to overcome a fundamentally oversupplied market, buy-side sources tell Kallanish.

“Since 2004, as buyers, it’s been drilled into our brains that the market is going to follow the scrap price,” says one end-user. “And that’s really going to languish.”

A West Coast service center executive says mills would much rather pay more for their raw materials and charge more for their finished goods.

That’s an unlikely scenario, he observes, until either domestic or foreign supply is seriously curtailed.

“A lot of the importers have not taken their foot off of the gas,” he comments. “Until we see a supply change, I don’t see it moving up. That’s the only way.”

Kallanish is holding its US hot-rolled price at $440-460/st and its US cold-rolled price at $560-580/st, both ex-works.