NEW YORK The hot-rolled steel market softened this week as market participants remain cautious over future pricing direction with supply returning and imports set to hit in the fall.
"Business has been decent lately. Activity has definitely slowed in the last week and a half and I think everyone anticipated some movement when we got to this time period," one mill source said.
"Production-wise, for hot-rolled most mills are pushing into October," the mill source said. "With imports starting to come in, and in an even bigger way in the next four weeks, Im unsure if the bottom will completely fall out. Everyone is just watching."
Hot-rolled sheet prices edged down to $32.50 per hundredweight ($650 per ton) f.o.b. Midwest mill from $32.75 per cwt ($655 per ton) previously. Larger tonnage deals closer to $32 per cwt ($640 per ton) were possible with certain mills, sources said. Cold-rolled remained unchanged at $37.50 per cwt ($750 per ton) f.o.b. Midwest mill. However, many buyers have reported that certain mills have held firm on base prices while discounting extras, thus distorting perceived base prices.
Some participants pointed out that imports to the East and Gulf Coast could put downward pressure on domestic pricing in the fall. While hot-rolled deals have remained rare, a number of traders confirmed, shipments of coated material, particularly Chinese cold-rolled, are expected to hit in the coming weeks (amm.com, June 12).
"Business has been slow but steady," one trader said. "The steel thats arriving in October and November was priced at the low end of the cycle. The one thing thats unknown is how much steel is unsold, and that volume will affect prices domestically."
With rumors of stable to falling prices, buyers said the best plan of action is to just watch and wait.