Soft US scrap prices haven’t helped maintain US HRC prices. As of late May, the expectation throughout the marketplace was that scrap prices in the Midwest would trade sideways during the June buy-cycle, yet data indicates that prices settled at approximately $30/gt below May's settled prices.
“The mils got aggressive,” a source noted. “With Turkey buying on export side, the broad expectation was that scrap would settle sideways on the East coast, and soft sideways in some of the inland areas, but with finished prices dipping, mills took their pound of flesh.”
And while current US HRC prices remain in the “official” range of $28-$29 cwt. ($617-$639/mt or $560-$580/nt) for the “average buyer,” with volume buyers indicating they’re able to do “$1.00 cwt. ($22/mt or $20/nt) better,” there are concerns that an additional downward revision may be forthcoming.
Last week, SteelOrbis reported speculated that $26 cwt. ($573/mt or $520/nt) ex-mill HRC prices were on the horizon. With scrap having settled downward in the current month, it’s believed that US HRC prices will experience additional softening in the next several days.