US hot-rolled coil (HRC) prices fell this week after a sharp decline in ferrous scrap pricing weighed on market sentiment.
The Argus assessment for US HRC ex-works Midwest dropped by $17/st to $575.50/st from $592.50/st a week ago. Lead times remained steady at 4-5 weeks
The CME HRC futures market continued downward, with October futures prices sliding by $10/st to $538/st, and November prices falling by $13/st to $535/st. December futures for HRC fell by $8/st to $543/st.
The large drop in ferrous scrap pricing for September's domestic trade exacerbated weak demand conditions in the finished steel market. As domestic scrap prices fell on average $30/gt for obsolete grades and $40/gt for prime scrap, spot market buyers for finished steel goods assumed a holding pattern to determine the impact on steel pricing.
Market participants anticipated buying interest to pick up toward the end of this week and the start of next week.
The US generated 130,000 new nonfarm jobs in August, fewer than most analysts expected and the latest sign the economy is slowing amid mounting concerns over the US-China trade conflict.
Mining jobs, excluding oil and gas, fell by 300 while primary metals manufacturing lost 800 jobs while fabricated metal products shed 1,700 jobs.
Summary of market activity heard by Argus
- HRC, US: Tradeable value at $595/st, ex-works Midwest, according to seller
- HRC, US: Tradeable value at $583/st, ex-works Midwest, according to buyer
- HRC, US: Tradeable value at $580/st, ex-works Midwest, according to buyer
- HRC, US: Tradeable value at $560/st, ex-works Midwest, according to buyer
- HRC, US: Tradeable value at $560/st, ex-works Midwest, according to buyer
