US domestic flat rolled spot prices inch higher

While there is still rampant skepticism over the sustainability of recent increases, US domestic flats prices have increased again in the last week. The deepest discounts that had been prevalent throughout May and June have largely dried up, and hot rolled coil (HRC) spot prices are up $1.00 cwt. ($22/mt or $20/nt) on the low end since last week and are now between $30.00-$31.00 cwt. ($661-$683/mt or $600-$620/nt) ex-Midwest mill, as sub-$30.00 cwt. offers have now largely subsided. Similarly, cold rolled coil (CRC) spot prices have firmed into the range of $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt) ex-Midwest mill, also reflecting a $1.00 cwt. increase on the low end over the past week. For now, the increase in prices has been largely due to purchases from small-to-medium-sized buyers, according to SteelOrbis sources.

Larger buyers still have not had to pay much, if any, of early July's $2.00 cwt. ($44/mt or $40/nt) price increase, and while average mill transaction prices have risen, volumes have not, and mill lead times have only expanded by a couple days, at best. But in order to push through the first increase, industry insiders are already anticipating a second increase by the end of July for September orders. And with predictions that the US scrap market bottomed in July and prices will trend sideways to up next month, flat rolled spots could continue their upward climb for at least a couple more weeks, but anything beyond that still remains extremely uncertain. Consequently, while some US buyers are placing offshore orders for niche products, most aren't ready to commit to import tonnages of commodity HRC and CRC just yet, especially with offer prices stagnant.

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