The recent upward trend in steel building prices in America and beyond has been noted by many global market observers.

However, despite increases in prices since 2005, in some markets, modest price reductions have been recorded for steel building materials.

A combination of factors is responsible for that deterioration. Although service center inventories are declining, they remain above the desired level and the destocking phase persists.

Real consumption, which has failed to recover, remains lackluster and now scrap costs have started to slide, posting two consecutive monthly drops.

However, import competition continues to be low, due to the weak dollar and good demand elsewhere in the world. These conditions are encouraging U.S. metal building facilities to start looking at export opportunities.

Imports are currently not a factor in the Canadian market, with lead times out to September. In the Ontario region, producers are reporting slower demand from the auto and steel building manufacturer groups.

Service center inventories are comfortable at 2-2.5 months supply but we have reports of falling business levels. Order books at the mills have weakened, resulting in some discounting.

The return from the extended early May holidays has heralded a number of positive price developments in the Chinese steel building market.

While it is difficult to assess how steel export licencing systems, along with the export tax levy and the strengthening exchange rate between the Yuan and U.S. dollar, may affect overseas transactions in the long term.

Japanese domestic demand for steel buildings as well as for metal materials by the auto and shipbuilding sectors in particular, remains buoyant. The export climate is also healthy.

However, total domestic inventories of metal products held by steel makers and service centers, at end March, climbed 1.25 percent - reversing the previous month's fall of 2.4 percent.

South Korean sales have shown some positive movements, mainly for seasonal reasons. In Taiwan, domestic market sentiment is quite robust at present.

The Polish economic situation continues to progress well, creating sales opportunities for the steel mills. In the Czech and Slovak markets prices are slightly up this month amidst good demand.

Inventories are at normal levels and supply is adequate.

No serious discussions regarding third quarter metal building price increases have taken place so far, and here is virtually no import pressure as European product prices are generally stable.