US HRC: Prices keep falling, sentiment weighs
US hot rolled coil (HRC) prices continued to decline as offers continue to drop and large parts of the steel industry gather in Atlanta for the primary conference of the year.
The Argus weekly domestic US HRC Midwest and southern assessments fell by $30/short ton (st) to $760/st ex-works. HRC prices have dropped 37pc since the peak of $1,200/st in April to their lowest since mid-January.
Repeatable HRC offers were heard between $720-800/st, with multiple assessments heard in the $700 level. One large service center said they would only buy 100-1,000st of HRC on the spot market if it were priced at $700/st.
Multiple buyers reported steel mills being "hungry" to negotiate for orders.
Few believe the upcoming set of outages in September and October will impact the HRC side of the market. Around 1mn st of flat steel production are expected to go offline during the outages at most US flat mills.
Steel mills and service centers gathered in Atlanta for the SMU Steel Summit grasped for direction in the market, with most expecting demand to remain steady at best over the coming months so long as an automotive strike does not materialize.
Steel service center chief executive Barry Zekelman said Monday that he expects there to be an auto strike between the United Auto Workers (UAW) and US automakers Ford, General Motors (GM) and Stellantis, adding that he believes it will be short in duration.
A strike at the three automakers would cut large amounts of steel demand, sending more flat steel into an already oversupplied market and grinding large amounts of manufacturing to a halt. Non-union US automakers like Honda, Nissan, Toyota and others would likely be unaffected by the strike.
The effects would ripple into the ferrous scrap industry, cutting both prime scrap supply and also removing some demand from steelmakers.
The weekly Argus US HRC Midwest lead time average rose to 4-5 weeks from 3-5 weeks, barely adjusting despite the upcoming outages.
The weekly Argus US HRC import price was flat at $700/st on a ddp Houston basis, with South Korean offers reported at that level.
Plate
The Argus weekly domestic US ex-works plate assessment remained flat at $1,570/st.
Uncertainty is creeping back into the plate market as prices remain elevated and some wonder if Nucor will drop its October offer prices.
Lead times fell to six weeks from 6-7 weeks.
The Argus US delivered plate assessment was flat at $1,610/st.
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Brazil unlocks relief spending to flooded state
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