US hot-rolled coil prices continued moving higher on July 19 as transactions at $1,840-$1,850/st were reported recently with limited supply options for the near future.
The daily Platts TSI US HRC index rose by $14 to $1,839.25/st on an ex-works Indiana basis.
Some market sources lately noted a rising number of import offers in the marketplace and saw that as a major threat for pricing outlook. Others, however, did not see rising imports cause a significant change in the current supply-demand imbalance by the end of the year.
“I’m not too worried about imports disrupting the current market and plummeting pricing any time soon,” a Midwest service-center source said. “It might become a bigger factor come Q1.”
The service-center source also noted worsening global logistics issues and anticipated delays in the arrivals of those imported products. “I started to hear this a week or two ago and picked up a little steam last week that the sheet market might find its tightest availability come Sept/Oct, meaning the worst might still be ahead of us,” he added.
Another Midwest service-center source echoed firm pricing sentiment: “I think it can make it through Q1 with outages and lack of imports.” He said that they were still able maintain their margins even with higher replacement costs.
Some end-users were running with almost no inventory and were in danger of stopping their operations due to a lack of steel, according to the second service-center source.
A third service center source reported a 1,000-st transaction at $1,850/st for September production of an integrated mill.
“It is still not easy to find spot tons out there,” a fourth service-center source said. “It feels like prices are about to peak but we have already failed many times at those predictions in the last six months.”
A fourth service-center source was hesitant in booking any spot orders at above $1,800/st but was not succeeding in finding availability below that level from domestic mills either. They were exploring their options in import markets and received an offer at $1,610/st DDP Houston from Serbia with November arrival time.
A fifth service-center source, meanwhile, was becoming more cautious about spot purchases: “We are seeing more tons available, so we are being cautious as can be, and dealing only with trusted suppliers. Virtually we are not buying anything for stock. If our buy doesn’t have a customer agreement behind it, we’re not buying.”
A European and a Canadian mill was offering at $1,580/st DDP Great Lakes port with an October or November delivery time, according to the fifth source.
— Ali Oktay