US HRC: Prices drop to December 2020 levels

US hot-rolled coil (HRC) prices broke through the $1,000/short ton (st) mark this week, falling to levels not seen since December 2020.

The Argus weekly domestic US HRC Midwest assessment dropped by $60/st to $940/st. The assessment was last in similar territory in mid-December 2020, when prices were rising out of Covid-19 pandemic induced lows in mid-2020. The southern assessment slipped by $9/st to $991/st on thin trading.

The HRC Midwest price has fallen by 37pc since hitting a peak of $1,500/st in the first half of April.

HRC lead times in the Midwest were flat at 3-4 weeks, with buyers keeping their spot purchases to a minimum.

Midwest offers were heard in a wide range between $940-1,100/st, with assessments down to $900/st.

Demand seems to be remaining steady though backlogs are reported to be getting worked through, with some service centers concerned about future business.

Others believe economic concerns over a possible recession could be overblown, but no one noted any positive demand trends outside of the energy industry.

Even that industry may soon be under pressure, with the 1 July price of $111.20/barrel (bl) for West Texas Intermediate fob Houtson down by 13pc from the early March peak of $127.81/bl.

The Argus HRC import assessment into Houston was flat at $900/st ddp.

Last week the Argus pig iron cfr New Orleans assessment fell by $15/metric tonne (t) to $630/t, edging closer to pre-conflict levels.

The spread between #1 busheling scrap delivered US Midwest mills and HRC selling prices fell by 14pc to $383/st. A year ago the spread was $1,144/st and was still months from hitting the peak spread of $1,441/st reached in mid-September.

The Argus weekly domestic US cold-rolled coil (CRC) assessment fell by $24.75/st to $1,442.25/st, while the hot dipped galvanized (HDG) coil assessment was flat at $1,400/st.

Lead times for CRC fell to 5 weeks from 6-7 weeks while HDG lead times fell to 4-5 weeks from 5-6 weeks.

The CME HRC Midwest futures market were down in the last week. August futures fell by $22/st to $870/st and September futures were down by $15/st to $870/st. October and November prices edged up by $1/st to $875 and $881/st, respectively. December price increased by $13/st to $893/st and January edged up by $1/st to $891/st.

Plate

The Argus weekly domestic US ex-works plate assessment fell by $8/st to $1,852/st. Electric arc furnace (EAF) steelmaker Nucor kept its plate prices flat at $1,860/st last week.

The plate delivered assessment was flat at $1,885/st. Lead times widened significantly to 3-9 weeks from 6-7 weeks as Nucor is said to have July lead times and EAF platemaker SSAB is said to be booked through August.