Hot-Rolled Coil Markets Show Contrasting Trends Amid Regional Economic Variables

In the ever-evolving steel market landscape, Hot-Rolled Coil (HRC) prices continue to demonstrate varied patterns across major markets. The HRC sector has witnessed notable developments in both European and American regions, with manufacturers and buyers adjusting their strategies to navigate current market conditions.

During the second week of October, Hot-Rolled Coil (HRC) prices in the German spot market recorded a slight uptick of 1.5%, while the US market showed a modest increase of 0.2%. This divergence in HRC price movements reflects the distinct regional market dynamics affecting the steel industry. The European HRC market, particularly in Germany, has seen ArcelorMittal leading price hikes, prompting other Northern European producers to follow suit. Meanwhile, US HRC prices, despite showing stability, maintain a premium over imported materials.

The European HRC market landscape presents a complex picture, with mixed attempts to raise prices amid varying buyer and seller expectations. While domestic HRC producers push for higher prices citing increased costs, buyers remain cautious due to subdued demand. The market has observed that Asian HRC import offers remain uncompetitive, potentially supporting domestic price recovery efforts. Southern European HRC prices have shown minimal changes, though uncertainty persists regarding the sustainability of higher prices from domestic mills.

In the United States, Nucor's HRC pricing strategy has been noteworthy, maintaining consistent spot prices for three consecutive weeks following increases since early September. The company's Hot-Rolled Coil pricing has consistently remained at the higher end of the market range, with lead times for HRC spot purchases staying between three to five weeks. Recent AISI data reveals significant industry metrics, with U.S. domestic raw steel production reaching 1.606 million net tons for the week ending October 5, 2024, operating at a 72.3% capacity utilization rate. This represents a 2.4% decline from the previous week and a more substantial 4.6% decrease from the same period last year.

As per ChemAnalyst, the HRC prices might show some downward movement in USA due to Nucor price adjustments, while in Germany the prices may remain in the bullish movement due to the restocking activity in the coming weeks. The US HRC market is projected to maintain its premium pricing structure, though with possible moderation based on demand patterns. The analyst also notes that China's economic measures and operational resumptions could significantly influence global HRC market dynamics, potentially affecting both European and American markets in the coming months. However, the actual price trajectory will largely depend on the resolution of current demand uncertainties and the effectiveness of China’s economic stimulus measures, which could significantly impact global HRC market dynamics.