As Fastmarkets reports in a recent research, prices for flat steel products in the U.S. showed impressive increases across the entire product range in October. This slightly exceeded Fastmarkets’ forecasts for coil products.
Domestic prices for hot rolled coils above forecasts
Domestic prices for hot rolled steel coils averaged $722 per tonne in October, exceeding the fast moving market forecasts of $705 per tonne.
Currently, Fastmarkets is forecasting continued upward price momentum for the rest of the fourth quarter of 2020 and into the first quarter of 2021.
Scrap prices are also expected to rise. The lead times of the mills are continuing to increase. The recommissioning of existing and also new capacities is delayed.
European HRC prices increased in October as expected
European HRC prices increased in October as expected; limited supply remains one of the main factors supporting the upward price trend. Delivery times from all major producers in the north of the region extended into next year, in some cases into March.
With limited import opportunities, it is expected that the tight market conditions will continue to drive up domestic prices. And demand from end users and traders is expected to remain strong.
European sheet metal prices slipped below the HRC price
In October, European steel sheet metal prices slipped below the HRC price, a trend not seen since 2009. A reported lack of contract orders pushed more material onto the spot market, forcing producers to accept lower prices.
Chinese export prices and East Chinese HRC prices exceeded expectations – they were only 1 or 3 yuan below September levels, averaging $513 and 3,712 yuan ($585) per ton, respectively.
At the same time, CRC prices increased, resulting in the highest markups since early 2019, with CRC prices $90 higher than HRC on the export market and $864 yuan ($128) higher than HRC on the domestic market.
Healthy domestic demand reduced the availability of material for export. This led to an upward revision of Fastmarket’s forecast for the fourth quarter of 2020 and into the first quarter of 2021.
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