US HRC: Steel prices rise as mills push increase

US prices for hot-rolled coil (HRC) continued to rise toward $600/short ton (st) as mills made a fourth round of price increases to take advantage of strong demand.

The Argus weekly domestic US HRC index rose by $13.25/st to $590/st ex-works Midwest today on seven indications from buy and sell-side sources. Prices have been rising for two months.

Lead times have extended to 8-9 weeks from seven weeks, their longest since mid-2018, a period just months after 25pc Section 232 steel tariffs were imposed on steel imports into the US.

While lead times appear to be well into February for many steelmakers, one still had availability in the third week of January.

One buyer said a mill offered HRC at $620/st, while steelmakers reported a narrow spread of $590-600/st.

Integrated steelmaker ArcelorMittal and electric arc furnace (EAF) steelmaker Nucor both increased flat-rolled steel prices by $40/st for a fourth time in two months. The steelmakers are pushing for prices to rise $160/st from the bottom.

The Argus weekly domestic US HRC index hit a low of $488/st for the week ending 22 October. Prices have since increased by 21pc.

HRC import prices into Houston stayed flat at $586/st ddp as demand for imported HRC remained muted.

Plate prices increased by $8/st to $670/st due to uncertainty and market weakness.

The CME HRC futures market rose last week, with February prices up by $1/st to $592/st, while March HRC prices also increased by $1/st to $592/st. April future prices rose by $3/st to $595/st, while May prices pushed up by $7/st to $600/st. Futures prices for 2020 now top out at the $600/st mark in May and June, a $7/st increase compared to the previous week.

Summary of market activity heard by Argus

• HRC, US: Tradeable value at $590/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $600/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $600/st, ex-works Midwest, according to seller
• HRC, US: Tradeable value at $570/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $585/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $565/st, ex-works Midwest, according to buyer
• HRC, US: Tradeable value at $620/st, ex-works Midwest, according to buyer