US hot-rolled coil index nears $50/cwt as quiet price hikes stick

Hot-rolled coil prices in the United States continued to test 12-year highs following a wave of quietly announced but successful mill increases, market participants said.

Fastmarkets’ daily steel hot-rolled coil index, fob mill US was calculated at $48.89 per hundredweight ($977.80 per ton) on Wednesday December 16, up 5.3% from $46.44 per cwt on Tuesday December 15 and up 11.1% from $44 per cwt a week earlier.

Inputs were received in a range of $45-51 per cwt. The assessor discarded one input at $50 per cwt from the producer sub-index because the mill in question had yet to officially unveil that new, higher price. But a medium-sized spot transaction – defined as 500 to 1,999 tons – was recorded at the same price in the consumer sub-index.

Heard in the market
Higher prices stemmed from a tide of price increases. They were mostly unannounced and rolled out quietly by mills to individual customers, and several specified minimum base prices of at least $50 per cwt for HRC, market participants said.

Lead times range from approximately six to 12 weeks – or into March at some producers, participants said. Consumers in need of steel, therefore, have little choice but to pay the historically high prices, sources said.

US HRC prices are at their highest since $50 per cwt in early September 2008, more than 12 years ago and shortly before the outbreak of the financial crisis. Some sources said it’s risky to buy now because domestic prices could correct violently downward as they did in the fourth quarter of 2008.

But others said prices have more upside potential over at least the next month thanks to limited import competition, strong steel tags at home and abroad, especially in China, as well as to higher raw material costs both globally and domestically.

Quote of the day
“If buyers need February, I believe they can find limited tons. But the price is minimum $50 per cwt, and I have the impression that prices will be $54-55 per cwt within the next 30 days,” one distributor source said.

What to read next
While daily crude steel production stood at 2 million tonnes in mid-October, a 1.25% decrease from the previous year according to data published by China’s Iron and Steel Association (CISA), overall production has remained relatively firm following a strong first half of 2023. With no clear indications of a rebound in downstream steel prices in […]
Talks between the European Union and the United States began in October 2021, where both parties announced the Global Arrangement on Sustainable Steel and Aluminium (GASSA), a partnership in which both parties would negotiate an arrangement to combat global overcapacity and climate change. The discussions would include discouraging trade in high-carbon steel and aluminum that […]
US steel scrap prices ahead of November trade The Trend Indicator has rebounded into bullish territory, at 61.4 for November compared with a resolutely bearish 45.6 in October. This month’s indicator is at its highest since March’s outlook, when it was 65.2. The Outlook’s prediction model allows for an average month-on-month price increase of 5.1%. Respondents […]
Fastmarkets assessed its new aluminium low-carbon differential P1020A, US Midwest at zero on Friday November 3. The assessment for the aluminium low-carbon differential for value-added product, US Midwest, also was at zero on Friday. Fastmarkets aims to bring transparency to the market with its new low-carbon aluminium differentials. “We are getting lots of questions about carbon […]
With increasing volumes of shredded scrap being exported from the US West Coast, Fastmarkets is launching a shredded scrap export index to balance its ferrous scrap exports offering from the US East and West Coasts
China’s premium for copper cathode imports increased after the country’s golden week holiday from September 29 to October, supported amid favorable import conditions, while the premium in the US copper market came under pressure due to excess supply, sources said