Hot-rolled coil prices in the United States have moved above $50 per hundredweight ($1,000 per short ton) for the first time since early September 2008 thanks to a continuing supply shortage.
Fastmarkets' daily steel hot-rolled coil index, fob mill US rose to $50.06 per cwt ($1,001.20 per ton) on Wednesday December 23, up by 0.64% from $49.74 per cwt on Tuesday December 22 and 2.29% higher than $48.89 per cwt a week prior.
The index has climbed by $28.17 per cwt ($563.40 per ton) since falling to a more than four-year low of $21.89 per cwt on April 30, and now stands at its highest since the price was $50 per cwt on September 4, 2008.
Inputs were received in a range of $48.75-53.00 per cwt across all three sub-indices. The low and high ends of the range were provided by distributors, with producer and consumer inputs falling in between those levels. The assessor used their judgment to carry over deals in the distributor sub-index to minimize day-to-day volatility there.
Heard in the market
Some buyer sources said they were bracing for the market to move up to $55 per cwt in coming weeks, partially fueled by expectations of significantly higher ferrous scrap prices in January 2021.
Some mills are not quoting spot tons until their order books are open in March 2021 and April 2021, according to market participants. But some recent deals indicate that certain mini-mills still have small openings available for sooner than that. Still, availability is expected to continue to cause issues for at least the next two months, sources said.
Hot-rolled prices globally remain high as well.
Fastmarkets' daily steel hot-rolled coil index, domestic, exw Northern Europe was ?,?665 per tonne ($735.21 per short ton) on Wednesday, a 12-year high, due to a similar shortage of material. Meanwhile, steel hot-rolled coil domestic, ex-whs Eastern China - which hit a 12-year high earlier this week - stood at ?4,780-4,810 per tonne ($662.97-667.14 per short ton) on December 23, down due to a significant downturn in iron ore values.
And Russia's plans to increase its duty on ferrous scrap exports to combat the threat of a shortage of steelmaking raw materials in its domestic market could keep scrap prices high globally, some sources said.
Quotes of the day
"This has been a wild market which seems to run further into the first quarter," a producer source said. "I'm not sure when production will eventually catch up to demand."
"I thought this was going to peter out in January/February, but it's going to take a little longer," a Gulf Coast trader said. "It will be May/June before this is over. It's going to crash, probably this summer."
Mark Shenk in New York contributed to this report.