Increased demand pushes HRC past $57/cwt in US

Fastmarkets’ daily steel hot-rolled coil index, fob mill US was calculated at $57.03 per hundredweight ($1,140.60 per short ton) on Thursday January 28, up by 1.7% from $56.10 per cwt the previous day and by 2.7% from $55.51 per cwt one week earlier.

Inputs were collected in a range of $55-60 per cwt across all three subindices representing confirmed deals, mill offers and general assessments of spot market pricing levels.

Heard in the market
A lack of spot supply and strengthening demand continue to be the main factors keeping prices at historic levels in the domestic HRC market. Buyers are, in some cases, bidding against each other and continue to pick up what they can when available, while some mills remain late on deliveries due to strengthening end-user consumption.

Moreover, the current strength of demand should outweigh any dip in prime scrap costs at the conclusion of February’s raw material trade, sources said. Sources also noted that sooner than expected reopenings from Covid-19 lockdowns in certain parts of the US, along with the threat of additional lockdowns fading, also are buoying market sentiment.

With demand secure for the time being, the key question for the market is when additional supply will become available, sources said.

Quote of the day
“There’s a difference in northern and southern markets. What I’ve noticed, in the South there’s more capacity and people are learning there is a little more steel in the South,” a Midwest service center source said. “There’s no capacity in the North. That’s the No1 reason for the range [in pricing].”

Grace Lavigne Asenov, in New York, contributed to this report.