US HRC: Spot supply rises, demand still firm

US hot-rolled coil (HRC) supply showed some signs of increasing while prices continued to rise due to persistently high demand.

The Argus weekly domestic US HRC Midwest assessment rose by $34/short ton (st) to $1,364/st ex-works. Lead times widened 7-9 weeks from 8-9 weeks.

The Argus weekly domestic US HRC south assessment jumped by $42/st to $1,367/st.

Some service centers reported greater spot availability, at least partially driven by the lack of semiconductors impacting production in the automotive industry. Multiple North American automakers extended production cuts last week due to a lack of semiconductor supply.

Spot availability was seen across all flat-rolled products including cold-rolled coil (CRC) and hot-dipped galvanized (HDG) products.

Steel on the spot market was quickly snapped up at higher prices, with some mills receiving pricing as high as $1,400/st for spot tons.

The CME HRC Midwest futures market added to modest gains from the prior week, but remains mostly in backwardation. For May, futures prices rose by $9/st to $1,3454/st, while June prices increased by $15/st to $1,339/st. July prices rose by $48/st to $1,303/st, with August futures increasing by $59/st to $1,284/st. September futures pricing jumped by $99/st to $1,249/st, while October pricing is at $1,177/st..

Last week the April scrap trade ended with #1 busheling scrap delivered US Midwest mills flat and obsolete scrap grades down $20/gross ton (gt).

The spread between #1 busheling scrap delivered US Midwest mills and HRC selling prices rose by 4.1pc to $861.77/st from $827.77/st the week before. The spread is more than triple than a year ago, when it was $238.80/st.

The domestic US CRC assessment increased by $47/st to $1,567/st, while the hot-dipped galvanized (HDG) coil assessment increased by $39.25/st to $1,569.25/st. Mills have been able to secure pricing as high as $1,600/st. Lead times for CRC and HDG both rose to 10-12 weeks from 8-10 weeks. Spot supply remained limited but multiple service centers reported purchases of CRC and HDG on the spot market.

HRC import prices into Houston increased by $17.50/st to $1,217.50/st ddp as global prices continued to rise.

Plate

The Argus weekly domestic US plate assessment increased by $30/st to $1,230/st, while lead times extended to 6-8 weeks from 5-7 weeks.