US hot-rolled coil (HRC) spot prices continued to fall this week on low spot demand and declining scrap prices.

The Argus weekly domestic US HRC index fell by $4/st to $538/st ex-works Midwest today on one transaction and five indications from buy- and sell-side sources.

Lead times stayed steady at 4-5 weeks as many in the market continued to buy on contract, taking advantage of prices lower than on the spot market.

Some small spot buys were reported, with one service center making purchases of 100st and 160st at $540/st.

Market participants say meaningful inquiries of a couple thousand tons would easily drop into the $520/st range and possibly lower, with some thinking prices have further to fall, and others wondering if a price floor is coming in the next month.

As the strike at General Motors (GM) drags into its fourth week, the impact on the steel market seems to be muted so far, but long-term concerns about it weakening demand remain.

Another factor weighing on HRC prices are the continued decline of US ferrous scrap pricing. Prime scrap prices fell by $40/gross tonne (gt) across the country, with obsolete grades down by $30-35/gt depending on the region.

During the recent scrap buy, market participants said at least one flat-rolled mill in the Ohio Valley had a reduced buy.

HRC imports into Houston fell by $20/st to $560/st as lower scrap prices and falling global HRC prices have helped foreign producers drop their prices into the US.

But long lead times and the continued decline in US pricing are keeping many from pursuing HRC imports.

Plate prices fell to $680/st as the spot market remained muted with mills reportedly not gaining new orders after returning from outages. Some in the market say service center inventories are getting patchy due to a lack of spot buying to replenish inventories, which will eventually push some back into the market. Despite that, many expect prices to continue to slip along with HRC pricing.

The CME HRC futures market dropped in the last week, with November prices falling by $12/st to $500/st while December futures for HRC fell by $9/st to $512/st. January HRC prices fell by $5/st $525/st, while February prices slipped $1/st to $529/st.

Summary of market activity heard by Argus

• HRC, US: Transaction at $540/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $540/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $540/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $540/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $530/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $510/st, ex-works Midwest, according to buyer