Pittsburgh (Platts)--26Nov2012/552 pm EST/2252 GMT

The steady to upward momentum US sheet steel prices have seen since early October appears to have slowed, sources said Monday.

Both buyers and sellers said they had seen a slight tailing off in spot transaction prices for hot-rolled and cold-rolled material since before the Thanksgiving holiday. And hot-rolled coil and cold-rolled coil lead times appear to have settled in the four-week range for most mills, they said.

US spot sheet prices have remained in ranges of $640-660/st for HRC and $760-780/st for CRC over the past several weeks. However, sources said recent prices have gravitated toward the bottom of those ranges. Around "$640 is where we are," one broker said of current HRC mill pricing. "I see more of a chance for prices to go down than up."

A Midwest stockist said he had seen HRC quotes ranging from $630-640/st, with lead times no further than the end of December. "I see this as the bottom for pricing for the year-end," he said. "And [mills] coming out with another increase announcement for the New Year, I believe, won't have an impact on buying in this demand environment."

A distributor in the southern US agreed, saying "for the most part, buying is done and news going forward will be negative." However, he predicted prices will "gel for a while" at current levels.

One mill source said order activity prior to Thanksgiving had been steady, although at prices toward the low end of both HRC and CRC ranges.

An executive at another mill said buying had slowed, as most customers had finished purchasing for 2012 and the producers' December output was already committed.

Goldman Sachs analyst Sal Tharani said in a research note issued Monday that HRC prices appear to have settled around $640/st and the bank was "of the view that prices could modestly weaken in December, but then see some uptick in early [Q1] before sliding down again."

Tharani said Goldman Sachs' estimate for 2013 is for an "almost flattish pricing environment," with steel demand likely better next year and mills having curtailed production in recent months.

"We believe that the price momentum currently seen will be short lived and although HRC prices could move to [$700/st] level in early [Q1], sustainability beyond early [Q1] is questionable," he said. "The simple reason is that we still have over-capacity in the system and as prices tick up, mills will increase production rate[s]."

Based on feedback from the market, Platts cut its HRC and CRC assessments by about $10 from last week, to $640-650/st and $750-770/st, respectively. Hot Dip Galvanized steel remained steady at $800-840/st. All prices are ex-works, normalized to a Midwest (Indiana) mill basis.

--Christopher Davis, christopher_davis@platts.com --Edited by Keiron Greenhalgh, keiron_greenhalgh@platts.com