US domestic hot rolled coil (HRC) buyers say they’ll continue to be cautious about their purchases due to soft spot market prices and still-short ex-mill lead times.
Current spot market prices have softened by an additional $1.00 cwt. ($22/mt or $20/nt) since our last report a week ago, which brings the new, current average transaction range to $22.50-$23.50 cwt. ($496-$518/mt or $450-$470/nt), ex-Midwest mill.
Year-on-year, prices are trending slightly higher than during the same reporting period in 2015, when the average spot price transaction was trending at $21.00-$21.50 cwt. ($463-$474/mt or $420-$430/nt), ex-Midwest mill.
Lead times are trending at two to four weeks, sources note, adding that many buyers are “in an inventory depleting mode. No one is stocking right now because prices seem to be coming down on a daily basis.”
Buyers are not expected to start re-stocking until prices reach a floor, another source said. “When that happens, people will start buying, lead times will span out and no one should be surprised to see mills raise prices.”