Despite yet higher alloy surcharges in July, total transaction prices for CR 304 2mm sheet generally fell in the month apart from in Western Europe, where subdued buying conditions are being partially offset by voluntary production cuts. The largest falls - almost 170 US dollars/tonne - occurred in Japan, where alongside domestic production cuts, import pressures continue to increase. In the USA, where demand reductions and supply overshoot are less severe than elsewhere, prices have remained broadly stable. Though US production cuts have now been announced, however, and demand showed signs of recovery in June, it remains far from clear when supply-demand fundamentals will firm up noticeably. After all, with US transaction prices 250-300 US dollars/tonne higher than in Western Europe or Japan, having been as much as 100 US dollars/tonne lower as late as March this year, it is likely that imports will become increasingly attractive to US customers in the months ahead. Import offers had seemed to tail off in June, and it was no great surprise that Allegheny decided to follow international peers in extending the summer shutdowns the following month. As international demand remained subdued in July, however, more competitive offers have been noticed in recent weeks and though lead times from US mills may be presently lower than five weeks, which gives them a large advantage over importers in meeting local demand, they may be reluctant to add to earlier production cuts and potentially lose market share as seasonal demand starts to improve.
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