The most commonly heard spot market price transaction range for US domestic hot rolled coil (HRC) has ticked down by $0.50 cwt. ($11/mt or $10/nt) on the bottom end, and by $1.00 cwt. ($22/mt or $20/nt) since our last report a week ago, which brings the current range to $28.50-$29.50 cwt. ($628-$650/mt or $570-$590/nt), ex-mill, although sources close to SteelOrbis report that the bulk of transactions “for the average buyer” are taking place in the middle of that range.
For the most part, however, buyers seem most comfortable waiting on the sidelines until they believe that prices have bottomed out. Inventory levels are still healthier than are being reported, a source said, adding that that people aren’t buying unless they need to and even then, they are being cautious when it comes to booking tonnage.
The question as to how far US HRC spot market prices will erode has yet to be seen. Yesterday, several US flats mills announced they would be raising spot market prices by $2.00 cwt. ($44/mt or $40/nt), effective immediately. And while some believe that mills will have a hard time pushing prices upward, due to unexciting lead times and soft raw materials costs, it’s speculated the increase could prevent prices from slipping further.
Looking offshore, import HRC spot market prices in the US domestic market from Egypt and Serbia are still trending between $30-$31 cwt. ($661-$683/mt or $600-$620/nt), DDP loaded truck in US Gulf coast ports, however, buyers are uninterested in booking offshore due to current US spot market prices.