Hot-rolled coil prices in the United States hit another all-time high on tight supply, low inventories, lack of imports and higher raw materials costs.
Fastmarkets’ daily steel hot-rolled coil index, fob mill US was calculated at $61.44 per hundredweight ($1,228.80 per short ton) on Wednesday February 24, up 0.44% from $61.17 per cwt on Tuesday February 23 and 2.11% higher than $60.17 per cwt a week ago.
Inputs were received across all three sub-indices in a range of $58.25-65.00 per cwt, with the high and low ends representing assessments by distributors and consumers.
Heard in the market
Wednesday marks the seventh day in a row that Fastmarkets’ index has reached a new record high.
Lead times are currently at 8 to 12 weeks. Mills, however, continue to deliver material late by two to three weeks, and shipment delays have been further extended by recent severe winter weather across the United States, according to sources.
Distributors also continue to report that they are hearing from new customers looking for material due to the ongoing supply squeeze. However, they continue to run lean inventories on the fear that prices could crash.
Market participants who previously believed that this price rally would end by March underestimated the upside potential of scrap prices, according to a West Coast distributor. Plus, many thought that steel imports would have had more of an impact by now because of higher prices in the United States versus the rest of the world, but that hasn’t happened, he said.
Quote of the day
“We’re getting calls from people we haven’t heard from,” a midwestern distributor said. “If I have enough to satisfy my customers and I’ve placed a hedge on replacement [costs], I’m quoting high and hoping not to get the order, but even in 20% of the cases, they’ve taken it. …The more we inch up and stay where we’re at, the harder the crash is going to be.”