US HRC: Prices rise on spot sales

Tight supply, high demand and limited spot sales have continued to push the US hot-rolled coil (HRC) price higher.

The Argus weekly domestic US HRC Midwest assessment rose by $33.50/st to $1,555/st ex-works. Lead times shrank to 7-8 weeks from 8-9 weeks.

The Argus weekly domestic US HRC south assessment increased by $34/st to $1,559/st.

Spot sales of a few hundred tons were confirmed at $1,540/st and $1,550/st in the Midwest, with higher priced offers being pushed from the mills. Steelmakers appear to be attempting to reach $1,600/st spot HRC pricing.

Flat-rolled steel supply has increased only incrementally because of continued production issues within the North American auto industry. One toll processor estimated that May will be their lowest volume month so far in 2021, even below February's short month, and there is growing concern that the auto slowdown may continue to impact the tolling business into the third quarter.

The spread between #1 busheling scrap delivered US Midwest mills and HRC selling prices rose by 3.3pc to $1,052.77/st from $1,019.27/st the week before. The spread is nearly five times higher than a year ago, when it was $214.96/st.

The Argus weekly domestic US cold-rolled coil (CRC) assessment increased by $72/st to $1,772/st, while the Argus weekly hot-dipped galvanized (HDG) assessment jumped by $73/st to $1,773/st.

Lead times for CRC were flat at 9-10 weeks from 10-12 weeks, while HDG lead times rose to 9-10 weeks from 8-10 weeks.

The CME HRC Midwest futures market crashed in the last week, reversing the gains of the last few weeks and falling into backwardation for the rest of the year, the first time in a month that much of the near-term futures pricing has done so. For July, prices dropped by $163/st to $1,480/st, while August futures plummeted by $234/st to $1,400/st. September futures pricing collapsed by $264/st to $1,345/st, while October pricing plunged by $245/st to $1,300/st. November pricing was down to $1,210/st.

HRC import prices into Houston jumped by $75.50/st to $1,463/st ddp as global prices continued to rise. Global flat-rolled steel prices have risen alongside raw material costs and increased pricing out of Asia, although flat-rolled availability was heard to be limited as supply constraints impact the globe.

Plate

The Argus weekly domestic US plate assessment jumped by $215/st to $1,515/st delivered on a price increase from Cleveland-Cliffs that pushed its fob mill price to $1,490/st. Other plate makers like electric arc furnace (EAF) minimills Nucor and SSAB are expected to announce their own price increase in the next week. Lead times expanded to 7-9 weeks from eight weeks.