Prices
Hot Rolled Futures: Another Step Down for HRC Prices
Written by Bradley Clark
March 12, 2015
Steel prices continued their slide this week. The CRU was down $14 to $488/ton, which has put downward pressure on futures contracts for nearby months. April and May are trading approximately $10 lower this week with the former at $495/ton and the latter closer to $510/ton. While nearby months have been influenced by the deteriorating spot price, the second half of the forward curve remains much firmer. Q3 has trades being done around $525-$530/ton, and Q4 recently traded as high as $540/ton.
A bottom has yet to be reached for the steel market as slowing demand in China has hurt a vast amount of commodity prices including iron ore and coking coal. Environmental regulations placed on Chinese steel mills as well as slowing construction in the country have both had a large impact on global demand for iron ore, which is currently at $57/MT. Coking coal has seen a 12 percent slide in prices from this time last year; while not as dramatic as the fall in iron ore prices, this has allowed domestic mills to negotiate contracts well under $500/ton. The bottom of the market remains to be seen, but it gets closer each week as U.S. steel prices become more aligned with the global market.
Volume this week has been quite slow with only 2,000 tons trading so far.
A strong dollar and slowing global demand for scrap has kept U.S. exports as well as the price of ferrous scrap low. Prices are currently around $240/GT, which is approximately $150/GT lower than the same time last year. Prices are likely to remain low until growth in China picks up or a supply disruption limits the amount of scrap in the U.S. market.
Below is an interactive graph of the HRC Futures Forward Curve. The graph can only be seen when reading this article while logged into our Steel Market Update website:
{amchart id=”73″ HRC Futures Forward Curve}
Another one of our interactive graphs is below with the BUS (CME Busheling Scrap) forward curve.
{amchart id=”74″ BUS Futures Forward Curve}
Bradley Clark
Read more from Bradley ClarkLatest in Prices
Price gap between US HRC, most imports narrows slightly
In dollar-per-ton terms, US product is on average $141/st less than landed import prices (inclusive of the 50% tariff). That’s down from $148/st last week.
SMU price ranges: Sheet ticks higher, plate stable
Sheet steel indices increased across the board this week, while plate prices held steady. All five of SMU’s price indices are higher than they were two weeks ago, and all but one are above levels recorded four weeks ago.
Nucor lifts HR spot price by $10/ton
Nucor has raised its weekly spot list price on hot-rolled coil by $10 per short ton (st) after keeping it unchanged since Aug. 25.
Atlas Tube up $50/ton following NLMK USA sheet price hike
Atlas Tube, in a leading move, said it aims to increase prices for mechanical tubing, hollow structural sections (HSS), and piling products by at least $50 per short ton (st).
Pig iron market quiet as US mills aim to outwait Brazilian suppliers
US buyers want to drop pig iron prices to levels commensurate with the decline in prime scrap in their domestic market. Prime price shed $20 per gross ton (gt) in September and another $20/gt in October.