USA HRC Spot Prices Nearing $1,100/ton
Another week, another $10 or so more for domestic-made steel hot-rolled coil (HRC), according to several market participants on both the buy- and sell-sides. They pegged the currently tight spot market at $1,080-$1,085 per ton early this week.
“The pattern has been clear for some time,” a steel distributor in the southern US told WSD Tuesday. He explained: “Slow and steady mill offers are being accepted by buyers given little spot material availability. Demand is good, so you grab some tons.”
Lead times are said to be about eight weeks, taking them well into July and in some cases 10 weeks out at certain mills. “Order books are brimming,” beamed one steel mill sales rep.
“Most mills are still prioritizing contract orders,” said a service center buyer in the Midwest.
“Customers, for the most part, have kept their inventories low,” noted another mill sales rep.
One buyer mentioned that imported material pricing was looking more attractive, “but there is still (geopolitical) uncertainty around ocean transportation costs and arrival times.”
“Last week, $1,070 was a good number; this week, $1,080 is good,” noted the steel distributor.
Nucor on Monday raised its Consumer Spot Price (CSP) for HRC another $10 to $1,090 per ton—and to $1,140 per ton for CSI material on the west coast.
Buyers and sellers expect the HRC spot market rally to continue into mid-summer and most agreed that the $1,100 per ton mark would be topped soon—possibly as early as next week. “Next Monday is a holiday in the US (Memorial Day, May 25th), so Nucor’s CSP will probably be released Tuesday. I’d expect it to be $1,100 per ton, but the holiday week may slow down some buying activity. We’ll see.”
Trending well above $1,100 is the forward curve for HRC futures on the CME, which continues to point toward sustained market confidence. In fact, it has steepened since last week. Volumes are strongest for the July (795 lots) and June (541 lots) contracts, which settled Monday at $1,133/ton and $1,109/ton, respectively. The August and September contract settlements were even higher, at $1,146 and $1,147 per ton, respectively, but volumes were sharply lower. The curve shows prices begin to retreat in the fourth quarter.
WSD Take:
Spot prices are currently trending between $1,080 and $1,090 per ton with no slowing in sight as prices approach $1,100 per ton. As has been the case since the beginning of the year, tight supply-demand conditions continue to persist, as trade policy keeps sheet imports at near historically low levels, and extensive mill maintenance has prevented any creep-up in domestic sheet supply over the last several months. Demand has remained relatively steady, driven primarily by construction and infrastructure activity tied to AI-related data center buildouts and the subsequent increase in energy infrastructure investment.
WSD expects pricing to remain elevated at least through midsummer in the absence of any increase in imports. As mill maintenance schedules wind down and additional supply comes into the market in the second half of the year, there may be some relief in sight—but absent significant changes to USMCA parameters governing steel trade between the US, Mexico and Canada, WSD expects pricing to remain high well into the second half of the year.