The most commonly heard spot market price range for US HRC has softened by $1.00 cwt. ($22/mt or $20/nt) on the top end since our last report a week ago. The trend is due to similar reasons that SteelOrbis discussed in yesterday’s US CRC analysis.
First, mills have drastically increased capacity utilization in the past several months; second, US HRC imports are up year-over-year, from 155,890 mt (census data) in September 2017 to 225,128 mt in September 2018; and third, US HRC exports are down year-over-year, from 96,738 mt in September 2017 to 32,187 mt in September 2018.
Although Section 232 has helped firm domestic prices, it hasn’t helped address global overcapacity; retaliatory tariffs from other countries have also harmed steel export tonnages, which is further impacting the amount of steel available in the US market. All of this is having an impact on pricing.
Current HRC spot market pricing, however, is still up substantially from the same reporting period in 2017. Today’s range is being heard at $39.50-$40.50 cwt. ($871-$893/mt or $790-$810/nt), ex-mill, while the mid-November range in 2017 was recorded at $30-$31 cwt. ($661-$683/mt or $600-$620/nt), ex-mill.
Looking offshore, US import HRC from Korea and Egypt in the domestic market continues to be heard at approximately $37.00 cwt. ($816/mt or $740/nt), DDP loaded Truck in US Gulf coast ports, while US import HRC from Mexico in the US domestic market is also trending neutral, at $37.00-$38.00 cwt. ($816-$838/mt or $740-$760/nt), FOB Texas.