Spot market prices for US domestic hot and cold rolled coils have continued to be flexible, week-over-week, as unexciting demand, short lead times, and the pending year-end-holiday season continue to take their toll on the market.
Current HRC prices are still trending at $34-$37 cwt. ($750-$816/mt or $680-$740/nt), FOB mill, although deals up to $1.00 cwt. ($22/mt or $20/nt) below that range have been heard within the marketplace. And while “official” CRC prices have remained at $47-$49 ($1,036-$1,080/mt or $940-$980/nt), FOB mill deals up to $3.00 cwt. below that range have been reported based on tonnage.
Sources continue to report that service centers are “uninterested” in building inventory until the market starts to stabilize, “which no one thinks is going to happen before the end of the year.”
In terms of where market prices might bottom, some have pointed out that despite the fact that capacity still appears to be outpacing demand, that higher energy costs, higher gas prices, and higher shipping costs, could prevent prices from slipping too much further.
“Historically, prices were based on supply and demand, but now, higher gas prices, shipping costs, and electricity costs are all things that need to be factored into the current pricing situation,” a source said. “With that, I think we may have reached the point where the market has overcorrected. Do I think prices are going to spike back up? No. But I think prices could be a little lower now than they should be.”