Domestic US hot-rolled coil (HRC) prices continued to rise as mills held the line above $600/short ton (st) among tight supply and improved scrap prices.

The Argus weekly domestic US HRC index rose by $16.50/st to $611/st ex-works Midwest today on eight indications from buy- and sell-side sources.

Lead times strengthened to seven weeks from 5-7 weeks. Many mills appear to have filled their order books in the near term, helping their push for higher spot prices.

Upcoming outages are helping to support lead times, with integrated steelmaker US Steel set to have an outage at one of its Gary Works blast furnaces, while it also shuts down its Great Lakes mill in April. North Star BlueScope's mill in Ohio is also to have a maintenance outage in April that could last up to five days.

Prices for prime scrap rose by $10/gross ton (gt) in the March buy, while all other grades stayed flat. The increase is expected to help support mill's push for higher prices. The spread between #1 busheling scrap delivered US Midwest mills and HRC selling prices rose by 4.6pc to $340.91/st, lower than the spread of $360.95/st a year ago.

Gerdau announced yesterday that it is idling the melt shop and rolling mill at its 560,000st/yr St. Paul, Minnesota electric arc furnace (EAF) mill that makes rebar, merchant bar, special bars and round bars.

The rapid decline in oil prices over the last few days is not expected to ripple through the steel industry immediately. Impacts from the price war between oil producers Saudi Arabia and Russia would take months to be felt, though some oil and gas companies have already announced that they would pare back capital expenditures and have slashed dividends.

Analysts said TimkenSteel is the most exposed steel producer, with 15-20pc of its volumes potentially impacted, according to analyst Tyler Kenyon of Cowen. Other steelmakers who could be impacted are US Steel and EAF steelmaker Nucor, which each have around 10pc of their volumes exposed to the energy industry.

HRC import prices into Houston stayed flat at $630/st ddp.

Plate prices fell by $8.50/st to $668/st on continued weakness in the market.

Futures prices in the CME HRC futures market plummeted across the board this week. April HRC prices dropped by $26/st to $554/st while May prices fell by $25/st to $567/st. June futures prices declined by $26/st to $537/st, while July prices plummeted by $31/st to $532/st. August prices fell by $28/st to $535/st, and September futures prices fell by $27/st to $536/st. October HRC futures prices dropped by $30/st to $540/st.

Summary of market activity heard by Argus:

• HRC, US: Tradeable value at $630/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $617.50/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $625/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $610/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $590/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $600/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $605/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $610/st, ex-works Midwest, according to buyer