Flat steel prices were steady to lower this week amid scant flat steel demand and lower monthly scrap settle prices, flat steel market insiders told SteelOrbis this week. Market insiders said ongoing reports of short lead times at many US flat steel mills of about 3 weeks indicate current demand remains minimal, while supply availability remains robust, they said.
This week, while market activity was light, price quotations for spot HRC ranged $830-840/nt ($915-926/mt), off from $820-860/nt ($904-948/mt), or $41.00-43.00/cwt., one week earlier. Given this week’s further declines, SteelOrbis data shows that since the last week of March, spot HRC pricing has fallen more than 12 percent or $115/nt ($127/mt), from a yearly SteelOrbis HRC spot price high of $950/nt ($1,047/mt).
“Slow demand plus an ongoing oversupply situation is causing flat steel prices to drop,” said one Midwest flat steel insider.
Another contact echoed a similar market sentiment, with lead times revealing limited levels of demand, he said. “For standard sized steel, we’re hearing lead times have declined to about three weeks at pretty much every mill,” the flat steel insider on this week’s price decline. “With lead times at mills getting shorter, that’s a good indication that demand remains soft and prices are likely to continue to slip.”
This week, monthly scrap prices continued down for a second straight month, with most domestic grades reported $30-40/gt ($30-41/mt) less as inbound flows into scrap yards continue high, while domestic and export demand for new scrap remained limited.
“June scrap trade domestically is not up,” one scrap insider told SteelOrbis in reaction to reports circulated in market circles that large overseas buyers were expected to re-enter the US scrap market. “There’s too much flow currently into domestic yards, so we see June scrap at best sideways.”
On the mill side, Nucor’s Consumer Spot Price (CSP) declined another $10/nt to $900/nt ($992/mt), or $45.00/cwt., off from $910/nt ($931/mt), or $45.50/cwt., one week earlier. Nucor’s primary competitor Cleveland Cliff’s May spot order book price for HRC remains steady at $975/nt ($1,075/mt), or $48.75/cwt., since April 11.
In the cold-rolled markets, spot pricing was flat versus week-earlier levels with most spot transactions noted flat at $1,120-1,130/nt ($1,235-1,246/mt), or on average $1,125/nt. Given flat CRC pricing and declining HRC price levels, the weekly key price spread between the two steel grades increased $10/nt to $290/nt ($320/mt) or $14.50/cwt.
In the coated finished steel marketplace, spot HDG base product is assessed steady on the week at $960-$1,000/nt ($1,058-1,102/mt) on a delivered basis, or on average $980/nt, though off from $1,115-1,120/nt ($1,229-1,235/mt), or $55.75-56.00/cwt., two weeks earlier.
Market insiders said weekly steel pipe and plate pricing could continue to slump as HRC pricing continues lower and new demand for pipe for oil and gas exploration slumps as oil prices fall below key $65/bbl investment target levels, pipe insiders told SteelOrbis recently. US benchmark West Texas Intermediate (WTI) crude oil last traded at $62.00/bbl on May 14, up 1.15 percent on the day, though off more than 13.45 percent over the past three months.
In the pipe markets, hollow structural section (HSS) pricing was discussed this week at $1,700/nt ($1,873/mt), or about $0.85/cwt., down about $50/nt over the past several weeks.