Futures
HRC Futures: Buyers Look to Lock in Tons $100 Below Spot
Written by David Feldstein
July 12, 2018
The following article on the hot rolled coil (HRC) futures market was written by David Feldstein. As the Flack Global Metals Director of Risk Management, Dave is an active participant in the hot rolled futures market, and we believe he provides insightful commentary and trading ideas to our readers. Besides writing futures articles for Steel Market Update, Dave produces articles that our readers may find interesting under the heading “The Feldstein” on the Flack Global Metals website, www.FlackGlobalMetals.com. Note that Steel Market Update does not take any positions on HRC or scrap trading, and any recommendations made by David Feldstein are his opinions and not those of SMU. We recommend that anyone interested in trading steel futures enlist the help of a licensed broker or bank.
The Platts TSI Midwest HRC Index has now rallied 57.6 percent since October 2017.
Platts TSI Midwest HRC Index
The CME Midwest HRC futures curve remains sharply backwardated with futures trading $100 or more below spot as early as the November 2018 future. Futures have deflated as much as $50 over the last month with buyers few and far between. However, buyers returning from holiday looked to lock in prices, especially in November, December and January, bidding them up $10 – $20 at the start of the week.
CME Midwest HRC Futures Curve
LME Turkish scrap futures have fallen $15 since the month began with August settling today at $336/mt. CME busheling futures are down $5 to $395/lt thus far in July. June futures settled at $402.35
2nd Month Rolling LME Turkish Scrap and CME Busheling Futures
This article and the “Week Over Week” report have been following the “triangle” pattern in iron ore futures for some time. When a chart pattern forms a triangle, it is expected that trading of that product will see compressed volatility like a coiling spring, and whichever side of the triangle it breaks through, it will then break hard in that direction as the pent-up volatility is released. SGX iron ore futures have traded in a tight range since March and the 2nd month future has finally broken through one of the sides, below its long-term uptrend line that started in 2015. High volume is always an important factor, so watch for iron ore to start trading down on high volume. It could portend that a sharp sell-off is close.
2nd Month SGX Iron Ore Futures
David Feldstein
Read more from David FeldsteinLatest in Futures
HRC Futures: Here comes Trump bump 2.0?
No more excuses! The election is over. Donald Trump will be inaugurated on Monday January 20 with the Republican party in control of Congress. Now, it is time to get back to work!
HR Futures: Which way following election?
Since June, The US hot-rolled coil (HRC) futures market has been in a rare period of prolonged price stability, closely mirroring the subdued volatility seen in the physical market. Over the past five months, futures have been rangebound, with prices oscillating between a floor near $680 and a ceiling around $800. This tight range, highlighted in the chart, underscores a cautious market environment. The chart below shows the rolling 3rd month CME HRC Future.
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.