How low will US HRC prices go?

Friday, 10 May 2019 18:14:49 (GMT+3)   |   San Diego

Earlier this year, it was speculated that US HRC prices would fall from their July 2018 peak of $45.00 cwt. ($992/mt or $900/nt) and would settle “around $36.00 cwt.” ($794/mt or $720/nt), but current pricing trends indicate the market is likely to settle “quite a bit below prior predictions.”

“Everyone thought that Section 232 was somehow going to save the domestic steel industry,” a source said. “But today’s prices are lower than where they were before Section 232 was announced.”

Current prices, sources note, are trending between $31.00-$33.00 cwt.” ($683-$728/mt or $620-$660/nt), ex-mill, “depending on who you are and how many tons your buying.” In contrast, HRC prices in early March 2018, when Section 232 tariffs were announced, were trending at $39-$40 cwt. ($860-$882/mt or $780-$800/nt), ex-mill.

“If the domestic mills have proven anything, they’ve shown that they have no understanding as to how to manage supply versus demand,” another source said.

Market players say they’re concerned additional price corrections may be on the horizon due to downward settling scrap prices during this month’s buy cycle. 

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