US domestic flats spot prices have dropped another $1.00 cwt. ($22/mt or $20/nt) in the last week, and current low market activity is pointing to continued softening in the immediate future.
At least for the next couple weeks--and possibly longer--domestic flat-rolled spot prices will likely continue to slide, as there is little to stop them: domestic demand is mediocre; domestic mill production continues to increase; and arriving import levels remain high, resulting in balanced buyer inventories, and thus little necessity to make any immediate purchases. During their quarterly conference call Thursday, Nucor executives echoed that sentiment, indicating: "new domestic supply in the sheet market and increases in imports of sheet steel have begun to put significant pressure on prices and margins. Unless the supply/demand/pricing dynamics reverse themselves, the sheet market will be the most challenging for the industry in the third quarter."
Midwest HRC and CRC spot prices have come down $1.00 cwt. in the last week to the range of $34.00-$35.00 cwt. ($750-$772/mt or $680-$700/nt) and $39.00-$41.00 cwt. ($860-$904/mt or $780-$820/nt), respectively, both ex-mill. But deal-making is widespread, and prices as low as $33.00 cwt. ($728/mt or $660/nt) ex-Midwest mill for large buyers are not uncommon.
On the US West Coast, sources indicate that flats mills never fully booked June and July, and spot prices for August have come down approximately $2.00 cwt. ($44/mt or $40/nt) from July prices to about $39.00 cwt. ($860/mt or $780/nt) for hot rolled coil (HRC) and $44.00 cwt. ($970/mt or $880/nt) for cold rolled coil (CRC), both ex-mill. However, one West Coast distributor told SteelOrbis that mills are "wheeling and dealing all over the place," making drastic price cuts for larger customers, and cutting freight charges to compete with substantially lower Midwest spot prices.
With the US flats market still trending downward, there is little room left for new import booking activity. July has been a quiet month in terms of futures booking, despite falling import prices. Mexican, Chinese and Korean offer prices of HRC and CRC for the US have come down in the last week, but it doesn't appear to have had any effect on US-buyer interest. Delivery dates are as far out as October and November from some offshore sources of CRC such as China, a bet few are willing to take.
| Cwt. | Metric Ton (mt) | Net ton (nt) | Change from last week | |
| US domestic | ||||
| HRC | $34.00-$35.00 | $750-$772 | $680-$700 | ↓ $1.00 cwt. |
| CRC | $39.00-$41.00 | $860-$904 | $780-$820 | ↓ $1.00 cwt. |
| Mexico* | ||||
| HRC | $34.00-$35.00 | $750-$772 | $680-$700 | ↓ $1.00 cwt. |
| CRC | $40.00-$41.00 | $882-$904 | $800-$820 | ↓ $1.00 cwt. |
| China** | ||||
| CRC | $41.00-$42.00 | $904-$926 | $820-$840 | ↓ $1.00 cwt. |
| Korea** | ||||
| HRC | $37.00-$39.00 | $816-$860 | $740-$780 | ↓ $1.00 cwt. on the low end |
**DDP loaded truck in US West Coast ports