Fastmarkets’ daily steel hot-rolled coil index, fob mill US was calculated at $59.24 per hundredweight ($1,184.80 per short ton) on Monday February 8, up by a penny from $59.23 per cwt on Friday February 5 and an increase of 4.7% from $56.56 per cwt one week earlier.
Inputs were received across all three sub-indices in a range of $55-65 per cwt, representing confirmed deals, deals heard, mill offers and general assessments of spot market pricing levels. The high and low ends of that range represented non-transactional inputs provided by distributor sources.
Heard in the market
Overall, there are more positives than negatives on the horizon for the hot band spot market. Sources pointed to a continued lack of availability, steady input costs and potent demand from the automotive; heating, ventilating and air conditioning (HVAC); and non-residential construction end markets keeping historic pricing levels in place.
Sources also said that Big River Steel’s Phase 2 expansion has yet to meaningfully affect the supply landscape and ease the current shortage. And with market participants only buying what they need at present, spot pricing levels continue to be driven by smaller-tonnage – and therefore higher-priced – deals.
On the flip side, however, some sources said that service center inventories were starting to normalize once again. With the anticipated arrival of foreign HRC -mainly from Turkey and South Korea and booked during the fourth quarter of 2020 – supply and demand in the United States could come back into balance, they said.
Quote of the day
“If the mills don’t get caught up, it’ll still be high,” an end user said of limited mill output keeping prices elevated. “They don’t get opportunities like this very often, and they’re taking advantage of it.”
