Futures
Hot Rolled Futures Stuck in No Man's Land
Written by Bradley Clark
November 13, 2014
The following article on the hot rolled futures market comes to SMU from contributing writer Bradley Clark, Director of Steel Trading for Kataman Metals.
Over the past couple of weeks the HRC futures market has traded within a narrow range reflecting mixed sentiment among market participants. There seems to be a divergence of opinion regarding the direction of the underlying market as recent price hikes have stopped the recent slide in prices.
However, the spread between domestic prices and world prices, the continued fall in both scrap and iron ore, and continued concern for global economic growth have made some skeptical that current domestic steel prices are sustainable moving into next year. HRC futures prices for next year periods are all trading around $630 per ton. The curve is virtually flat from December onwards and only in a slight backwardation to current spot pricing.
Volumes have been decent over the past couple of weeks with over 20,000 tons trading.
Below is an interactive graphic depicting the latest hot rolled futures forward curve with a comparison to four weeks ago. The graph can only been seen and interacted with when you are logged into the website and reading this article online (otherwise it just appears to be an empty space on your screen).
{amchart id=”73″ HRC Futures Forward Curve}
Scrap prices and iron ore prices continue to decline, with busheling down nearly $40 per ton this month and iron ore testing new recent lows around $75 per ton.
Below is another interactive graphic, but for the latest busheling scrap forward curve in comparison to the same curve from four weeks ago.
{amchart id=”74″ BUS Futures Forward Curve}
Bradley Clark
Read more from Bradley ClarkLatest in Futures
HR futures: Support fails as market slows ahead of election
After a relatively stable and boring September, CME hot-rolled coil (HRC) futures have been on the move lower thus far in October. Since Sept. 30, the November and December futures have declined $63 and $65, respectively, with the curve’s contango steepening.
CRU: Open interest in December HR futures contract surges
CRU Principal Analyst Josh Spoores shares insight into the hot-rolled coil futures market.
HR futures: How many ways to stay the same?
While the English language is vast, there is not an endless number of ways to say, “no major changes have transpired.” And if anyone has been tasked with talking about steel price changes in physical and futures US domestic steel market over the last four months, they are probably stretching their ability to its limit.
CRU: HRC futures market prices in rosy Q4’24 and 2025
CRU Principal Analyst Josh Spoores shares with SMU his analysis of the hot-rolled coil futures market.
HR futures: Higher on news of Cliffs furnace idling
It had been a relatively quiet and steady CME HRC futures market since the end of August. That was upended by Thursday’s news that instead of a two-week maintenance outage, Cleveland-Cliffs would hot idle the C-6 blast furnace at its Cleveland Works for an uncertain period of time. The CME October HRC contract, HRCV4, gained $22 per short ton (st) on the day to provisionally close at $744/st on Thursday. The first and second quarter futures strips of 2025 gained $25/st and $24/st to provisionally settle at $823/st and $829/st, respectively.