Steel Products
SMU Fair Value Model Has Hot Rolled Coil Spot Pricing Above Fair Value for 8th Week
Written by John Packard
January 7, 2013
This week, the SMU Fair Value HRC (hot rolled coil) Model has spot HRC pricing above Fair Value for the eighth week in a row. This is due to the SMU average spot HRC index remaining the same at $635 per ton and scrap inputs remaining the same over last week’s figures. The Fair Value model now shows HRC prices $12 above the estimated Fair Value price.
Based on our sources, SMU expects scrap prices to vary by region, with early indications being the Midwest and South scrap prices as trending sideways and the East trending slightly higher by as much as $10 per gross ton.
As a reminder, the Fair Value HRC Model below came from the SMU acquisition of Steel Reality. The graph below demonstrates the relationship between scraps inputs creating an estimated “Fair Value” for HRC versus the actual spot price.
John Packard
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