US sheet prices continue to decline as service centres work to shed inventory before year-end, but at least some market players think that strategy may backfire early next year.

Kallanish lowered its hot-rolled price Monday from $420-440/short ton to $410-430/st and took its cold-rolled price from $550-570/st to $540-560/st.

One mill source says a general decay in commodity pricing is partly to blame for sheet erosion, but a lack of market enthusiasm is the primary driver.

“I’d say nothing’s driving it up,” the source says.

A buy-side source says HRC can be had for as low as $400/st from some large service centres, which is keeping the market depressed.

Those same service centres are not buying replacement inventory, he says, which is forcing mills to hunt for business but also setting them up for a potential pop in lead times in the first quarter.

“I think they’re going to hit a wall in November and December,” he says. “And they’re going to realise they don’t have any steel, and lead times are going to jump up. I think in a funny way the biggest [... mill] customers may be in the worst shape.”