For the Quarter Ending September 2024
North America
In Q3 2024, Hot Rolled Coil (HRC) prices in North America saw a significant increase, driven by various key factors. The market experienced a strong rise in prices due to heightened demand, alongside supply constraints and rising production costs. This upward trend was especially prominent in the USA, where the most substantial price changes occurred.
Overall, the quarter exhibited a positive trajectory in HRC pricing, showing a considerable increase compared to the same period last year. However, it is worth noting that there was a slight decline of 9% from the previous quarter in 2024 despite the prices raised by the Nucor, reflecting some volatility in the pricing dynamics.
Additionally, an increase in prices was observed between the first half and the second half of the quarter, indicating a consistent upward trend throughout this period. The quarter concluded with the latest price of USD 842/MT of HR Coil (3 mm) DEL Illinois in the USA, signalling a robust pricing environment with a consistent upward sentiment.
Asia-Pacific
In Q3 2024, the Hot Rolled Coils (HRC) market in the APAC region witnessed a significant decline in prices, mainly influenced by several key factors. The quarter saw a challenging environment for HRC pricing, with a notable decrease compared to the same quarter last year. The recent decline from the previous quarter in 2024 has deepened the ongoing downward trend in market prices.
As a significant player in this market, China experienced the most noticeable price fluctuations, with significant drops observed between the first and second halves of the quarter. This dramatic change highlights the broader market dynamics characterized by negative sentiment. Various factors have contributed to this atmosphere, including the lack of effective policy support, the ongoing transition to new national standards, and the repercussions of the slack season, which has negatively affected demand levels. Collectively, these elements have created a difficult environment for market participants, leading to heightened uncertainty and further price reductions.
The latest quarter-ending price for HR Coil (Q235-1 mm) Ex Shanghai in China stood at USD 478/MT, reflecting the prevailing decreasing pricing environment in the region. The quarter was characterized by a notable decrease in prices, highlighting a challenging period for the HRC market in the APAC region, particularly in China.
Europe
In Q3 2024, the Hot Rolled Coils market in Europe faced a significant downturn, with prices declining compared to the previous quarter. This overall decrease from the same quarter last year can be linked to several key factors affecting market prices. There has been weak demand from major end-user sectors, such as automotive and construction, along with issues of oversupply, which have contributed to pricing pressures.
Additionally, the ongoing summer holiday season has dampened overall market activity, leading to limited trading and subdued purchasing levels. Germany has been particularly affected by these changes, experiencing the most significant impact, with prices dropping by 3% from the previous quarter. The correlation in price changes suggests a negative trend, with the market marked by instability and uncertainty.
Seasonal factors have also played a crucial role in these fluctuations, as buyers have become hesitant to restock, choosing instead to wait for clearer market signals before making further commitments. The latest quarter-ending price for HR Coil (3 mm) FD-Ruhr in Germany stands at USD 658/MT, reflecting the prevailing negative sentiment and challenging market conditions.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Hot Rolled Coils (HRC) market experienced a pronounced downturn in pricing, influenced by multifaceted factors. The quarter exhibited a negative pricing environment primarily due to persistent oversupply amidst subdued demand. The steel industry grappled with an imbalance between production and consumption, exacerbated by economic headwinds such as inflationary pressures and rising input costs. Compounded by global competition, the influx of competitively priced imports further intensified domestic price declines.
Focusing on the USA, which witnessed the most significant price changes, the overall trend mirrored a consistent decrease throughout the quarter. The seasonality typically associated with a mid-year uptick in construction and manufacturing failed to materialize, suppressed by market saturation and lacklustre demand recovery. Within Q2, the first and second halves saw a sequential price drop, underscoring the relentless downward momentum.
The correlation in price changes was influenced by lower industrial activity and strategic discounting by mills attempting to clear inventory. This consistent decrease in prices highlights a negative pricing sentiment, driven by an oversupply scenario and external pressures, reflecting an overall adverse environment for the HRC market in North America during this period.
Europe
In the context of Q2 2024, the European market for Hot Rolled Coils (HRC) experienced a relatively stable pricing environment. This quarter was characterized by a combination of subdued demand, cautious buyer behaviour, and competitive pressures from imports, all of which contributed to a largely stagnant pricing trend. The overall market sentiment oscillated between concern over low end-user consumption and cautious optimism stemming from strategic inventory management and controlled supply. A significant influence was the fluctuating cost of raw materials, specifically iron ore and coking coal, which exerted downward pressure on HRC prices. Additionally, the regulatory impact of the European Union's safeguard quota adjustments played a pivotal role in maintaining a delicate balance between domestic supply and international competition. Focusing on Germany, which saw the most pronounced price adjustments, the market trends underscored a consistent decline. Compared to the same quarter last year, prices are dropped reflecting broader market challenges and persistent low demand. When compared to the previous quarter of 2024, the decline mirrored the declining pattern, indicating a continuing trend rather than a sudden shift in market dynamics. The consistent decline observed in Germany indicates a negative pricing environment. Overarching factors such as low demand from key steel-consuming sectors, cautious restocking by buyers, and competitive pressures from non-European suppliers predominantly influenced this trend. Seasonality played a negligible role, with stability being driven more by market fundamentals than by seasonal variations. Correlatively, the prices reflected sustained pressures rather than episodic changes, further affirming the stability in the broader context of market challenges.
Asia-Pacific
The pricing environment for Hot Rolled Coils (HRC) in the APAC region during Q2 2024 has consistently trended downward, influenced by several key factors. The region's market experienced subdued demand across several sectors, exacerbated by competitive pressures from Chinese suppliers. The influx of low-priced imports from China created significant challenges for local producers, leading to a decline in market prices. Additionally, seasonal factors such as the monsoon season adversely affected construction activities, further dampening demand. The persistence of high raw material costs, particularly coking coal, also exerted downward pressure on profit margins, compelling producers to adjust prices accordingly. Specifically in China, which saw the most significant price fluctuations, the overall trend was characterized by a decreasing price trajectory. The moderation in steel demand, particularly from the real estate sector, played a pivotal role in this decline. Seasonality factors, including a traditional off-season for construction, compounded the situation. From the previous quarter of 2024, there was a recorded decrease, indicating a persistent downward trend. Comparing the first and second half of the quarter, the price dropped, underscoring the ongoing challenges in market dynamics. The quarter ended with HR Coil, epitomizing a negative pricing environment dominated by declining trends. The continuous price depreciation throughout the quarter highlights the struggles faced by the steel industry in maintaining stable market conditions amidst fluctuating demand and competitive pressures.
For the Quarter Ending March 2024
North America
In the first quarter of 2024, the North American Hot Rolled Coils (HRC) market demonstrate decline in prices. Various factors influenced the market during this period, including an increase in steel imports, sluggish demand from downstream steel-consuming industries, and disruptions in trade routes. However, the primary reason for the slight decrease in prices was the reduced demand from the automotive sector, as manufacturers faced uncertainties.
Steel mills are experiencing shortened delivery lead times as buyers withdraw due to the awareness of declining coil prices. This has prompted many stockists to replenish their inventories, exacerbating the reduction in prices. Notably, the price of HRC fell by approximately 14% month-on-month and is expected to continue decreasing in March.
Despite the reduced demand from downstream sectors, the market maintained stable prices in the ending week of March, primarily driven by the infrastructural development sector. This sector was supported by green steel and renewable energy projects, which contributed to the overall stability. Additionally, no plant shutdowns were reported in the USA during this period.
Europe
In Q1 2024, Hot Rolled Coils (HRC) prices in the Europe region remained Bearish, reflecting a consistent pricing environment. The European HRC market experienced consistent price declines in both February and March, reflecting persistently low demand and buyer apprehension. Throughout February and March, the European HRC market exhibited a trend of hesitant buying behaviour, with buyers cautious about stockpiling due to uncertainties surrounding near-term prices. During these months, market activity remained subdued, leading to reluctance among buyers to meet the prices set by mills, subsequently affecting the demand for both domestic and imported HRC. The German HRC market faced challenges with weak trading activity, prompting discussions of potential production cuts by producers to combat price declines. A decline in demand for steel hot-rolled coils was notable across the European market, driven by buyer apprehension and market uncertainties, particularly surrounding price stability. As prices continued to fall, consumers adopted a "wait-and-see" strategy, further impacting market activity. The overall sentiment in the European HRC market emphasized the need for a strategic approach to navigate supply and demand dynamics effectively, given the prevailing uncertainties and subdued market conditions. The data for this summary was derived from market reports and indexes, reflecting the overall caution and restraint observed in both domestic and imported HRC markets across Europe, with a specific focus on the German market dynamics.
Asia-Pacific
In Q1 2024, the pricing environment for Hot Rolled Coils (HRC) in the APAC region has been predominantly negative, with prices experiencing a notable decrease with stable movement. Several factors have influenced the market prices during this period. One significant factor is the decrease in demand from the construction and infrastructure sectors, resulting in surplus inventory levels. Additionally, disruptions in trade routes, such as the Panama Canal and the Red Sea, have impacted the availability of HRC, leading to increased freight charges and extended lead times. China has seen the maximum price changes in the APAC region. The overall trend in China has been characterized by stability, with prices remaining relatively unchanged. Seasonality has also played a role, with the winter season and holiday period leading to a decrease in demand from downstream industries. Compared to the same quarter last year, there has been a significant decrease in prices. The percentage change from the previous quarter in 2024 is recorded at -1.2% in China.
For the Quarter Ending December 2023
North America
Hot Rolled Coils (HRC) pricing for North America in Q4 2023 witnessed a decline in price trend amidst several factors that impacted the market. In October, despite a stronger U.S. dollar globally, hot rolled coil prices in the U.S. remained low, influenced by reduced purchase offers, constrained transportation due to low river levels, and the potential United Auto Workers strike. A cautionary approach by auto companies and concerns about rising inflation slowed demand. However, a subsequent rise in hot rolled coil prices in the domestic market was triggered by lower inventory levels, Cleaveland Cliffs' price increase, and reduced production during the UAW strike.
Various factors contributed to the upward trend, including increased input costs, optimism in the construction sector, and global stimulus measures. Chinese government policies and rising U.S. interest rates also impacted the global increase. In December, prices rose further due to decreased supply, increased order fulfillment for the upcoming months, and announcements of price hikes by major manufacturers.
Concerns over disrupted trade in the Red Sea and the extension of EU tariffs by the Biden administration further influenced the market. Despite a temporary dip in demand during the holiday season, the overall trajectory remained upward. Q4 2023 saw a 1.0% increase in HRC prices in the USA, with the last quarter ending price at USD 1035/MT of HR Coil (3 mm) DEL Illinois. No plant shutdown was observed in the USA during this quarter.
Asia-Pacific
The Hot Rolled Coils (HRC) pricing in the APAC region during Q4 2023 remained stable, with moderate demand and supply. In October, steel mills, including Chung Hung Steel Corporation (CHS) and China Steel Corporation (CSC), stabilized Hot Rolled Coil prices in response to increased raw material costs like iron ore and steel scrap. Despite sluggish international demand, substantial orders were placed, leading to price hikes to counter rising production costs. These adjustments are anticipated to continue into the early stages of the last quarter. In November, the Taiwanese spot market saw a significant increase in Hot Rolled Coil prices due to constrained supply, heightened demand from the automotive and construction sectors, and disruptions in the supply chain, notably in the Panama Canal. December witnessed a consistent pricing trajectory influenced by reduced demand during the winter and holiday seasons, challenges in trade routes due to disruptions in the Panama Canal and the Red Sea, and a decline in overseas demand for feedstock amid uncertain market conditions. Adverse weather conditions further contributed to a slowdown in manufacturing activity across Taiwan. The HRC prices in the APAC region during Q4 2023 are USD 975/MT of HR Coil (SS400- 1.2 mm) FOB Taichung in Taiwan, with no change in the price from the previous quarter.
Europe
The Hot Rolled Coil pricing for the Europe region remained stable in the fourth quarter of 2023. In November, the Hot Rolled Coil (HRC) market in Russia experienced fluctuating prices influenced by several factors. Initially, prices declined due to increased production and reduced demand from the automotive sector, leading to surplus supply. Notably, the black sea market exhibited a diminished interest in Russian-grade pig iron, further contributing to subdued demand. Major local mills, including Byelorussian Steel Works, MZ Balakovo, and Metinvest’s Kametstal steelworks, intensified supply with higher production. Disruptions in the Panama Canal and increased freight charges led to a preference for the Suez Canal route. Downstream industries experienced sufficient demand, prompting major Steel manufacturers to boost scrap imports. However, by the end of November, HRC prices witnessed a decrease, driven by reduced demand, elevated inventory levels, and disruptions in Red Sea trade. Attacks in Yemen by the Houthi Rebel group caused export reductions, increased freight costs, and compelled mills to scale down operations. Harsh winter conditions and a global shift towards electric vehicles contributed to a modest decline in downstream industries like construction, automotive, paper, pulp, paint, and glass manufacturing in the Russian market. The latest price of HR Coil (3 mm) Ex Moscow in Russia for the last quarter is USD 825/MT.
For the Quarter Ending September 2023
North America
The US Hot Rolled Coil (HRC) market has seen a price decline in the third quarter of 2023. Initially, the price of Hot Rolled Coil rose due to the overseas Chinese stimulus measures and US interest rate hikes, boosting demand from the infrastructure sector. However, in July, prices fell as supply increased with the reopening of the Steel Dynamics Sixton mill in Texas, and buyers grew cautious. August saw further declines as demand weakened, shipping costs rose, and seasonal factors played a role. September witnessed a significant drop in HRC prices due to a strike by United Auto Workers (UAW) in the automotive sector, disrupting production and impacting the market. Concerns about inflation and limited demand from construction and automotive sectors have also added to market uncertainty. In summary, the US HRC market has faced challenges, including labor strikes, inflation concerns, and fluctuating demand, resulting in price fluctuations. The ripple effect of a declining economy and reduced demand resulted in a plunging price trend of Hot Rolled Coil in the USA.
Asia-Pacific
In Q3 of 2023, the Hot Rolled Coil (HRC) prices in the Taiwanese spot market plunged due to diminishing demand in the automotive and construction sectors. This resulted from a weakened domestic economy and a global economic downturn. HRC manufacturers across the USA switched to lower-cost pig iron from overseas sources due to a steel scrap shortage, reducing production costs. Tesla's industrial automation led to employee layoffs and reduced HRC demand in the automotive sector. High inventory levels, economic challenges, and rising interest rates deterred large orders in the Taiwan HRC market. Oversupply was exacerbated by Chinese mills dumping HRC in Taiwan and other countries warehouses, keeping the market sentiment bearish. Declining economic conditions further reduced HRC consumption and raised local inventory levels. Despite these issues, Taiwanese steel mills like Chung Hung Steel Corporation (CHS) and China Steel Corporation (CSC) raised HRC prices to counter material cost increases. Overseas demand remained stable, especially from Europe and the US. The price increases were expected to persist in the last quarter due to rising production costs and steady overseas demand, providing optimism for the downstream market.
Europe
In Q3 of 2023, the Italian Hot Rolled coil market remained on a lower edge amidst reduced local production and weakened demand in automotive and construction. Exported iron ore production increased by 9%, keeping feedstock prices low. Steel mills operated at lower rates due to maintenance, and automotive demand suffered from high inventories. Asian import quotas were underused due to tariff concerns, pushing buyers toward regional options. Downstream industry demand remained steady as buyers adopted a cautious approach. In September, Italian Hot Rolled Coil prices started declining due to rising raw material and energy costs, affecting the spot market. Automotive demand remained subdued, and trading activity stayed slow. Producers hesitated to lower prices further, already operating below production costs, due to unexpected increases in raw material and energy expenses. Hot Rolled Coil availability was stable, and exports continued due to overseas demand. The downstream market saw strong demand, partly driven by imports. Despite economic uncertainty and interest rate fluctuations, mill price increases, fueled by rising raw material costs, gave hope for increased demand.
For the Quarter Ending June 2023
North America
The US Hot Rolled Coil prices showed an overall declining price trend in the second quarter of 2023, despite of increasing price trend in the initial phase of the quarter, i.e., April. In the first month of the second quarter, the price of Hot Rolled Coil inclined in the US spot market as the local mills maintained a high base price that helped in maintaining a positive market sentiment for domestic and overseas buyers. The delivery time was reduced to 7-8 weeks from the previous 7-9 weeks. This led to a decline in the local inventory levels and hiked the price of HRC in the US spot market. Meanwhile, in H2, the market sentiment for the Hot Rolled Coil plunged as the economic instability increased amid the debt crisis caused by the failure of major banks across the USA. The economic condition worsened as the inflation rate rose, and the approval of the we federal reserve hiked the interest rate. The buyers were shying away from placing large as the US HRC spot market got sluggish. Additionally, The decline in employment rate also impacted the downstream US and infrastructural sector workforce and led to a decline in demand for the Hot Rolled Coil in the US spot market. The local inventory levels were on a higher edge which provoked the US government to impose countervailing duties on the import of HRC from overseas Indian and European suppliers. At the end of Q2, the US government signed a deal to extend the debt crisis further for two more years. This gave hope for the upliftment of the US HRC market for the upcoming quarter.
Asia
The Chinese Hot Rolled Coil prices continuously declined throughout the second quarter of 2023. In April, the price of feedstock such as Coking coal fell amid increased production rate after obtaining profitable margins from the Chinese spot market. The Qingming Festival and heavy rain disrupted the demand and consumption rate of Hot Rolled Coil in China. The export quantity declined as the rising inflation rate and uncertain economic conditions decreased the overseas demand from the US and European markets. Additionally, the export became more straining after the overseas European Union and US government imposition of countervailing duties on Chinese-made steel products. The downstream construction activity was also at a plunging rate as the arrival of the monsoon drastically affected the construction and infrastructural activity across the Chinese spot market. Additionally, the downstream automotive demand was plummeting as the inflation rate hike reduced local customers' buying capacity, leading to an increased supply of Hot Rolled Coil. The Chinese government applied some economic stimulus to overcome the declining price trend of HRC at the end of the Second Quarter of 2023.
Europe
In the second quarter, the price of Italian-made Hot rolled Coil increased in the initial phase of Q2, but later overall decline was observed in the H2 of the second quarter. In April, the price of Hot Rolled Coil surged in the Italian spot market. The inventory levels declined in the initial phase of Q2 as the overseas delivery time was delayed from the ArcelorMittal plant in Italy. The downstream automotive industry was also showing a significant growth rate which led to sufficient demand in April and provoked the local Italian Steel mills to increase the price of HRC. Meanwhile, in H2 of the second quarter, the situation decreased; the economic downturn in the global market had adversely affected the market sentiment for Hot Rolled Coil in entire Europe. The labor shortage in overall Europe affected the construction work in Italy also. The declining construction activity reduced the consumption rate of HRC and led to mounting inventory levels in the Italian spot market. Additionally, the automobile industry declined. The European Union imposed dumping duties on the imported Hot Rolled Coil from the overseas Chinese and Indian markets. The Italian government's plans to increase interest rates led to shying tendency from the buyers' side, and this provoked the Italian steel mills to decrease their offer price in the H2 of the second quarter.
For the Quarter Ending March 2023
North America
In the first quarter of 2023, Hot Rolled Coil (HRC) prices in the US market surged due to the increasing prices of raw materials and the rise in hand-to-mouth trading activities. Domestic mills raised offer prices, resulting in buyers' skepticism after several rounds of mill price hikes. Even after formally raising prices by USD 450/MT between the end of November and the 21st of February, mills continued to receive higher flat steel spot offers. The price increases were led by Nucor, followed by Cliffs, US Steel, NLMK USA, and others. However, by the end of the quarter, HRC prices showed stagnancy, breaking six weeks of increases, as mills issued no new formal price hikes, and buyers began examining their order books. Although southern mills were booked until August, longer lead times did not appear to increase demand or allow mills to book higher-priced spot tonnes. Buyers reviewed their order books to determine their next moves and managed inventories by reducing contract purchases as the price cycle moved downward. As a result, HRC (3 mm) for Ex-US Midwest was fixed at USD 1150/MT.
Asia Pacific
The first quarter of 2023 witnessed an upward trend in the prices of Hot Rolled Coil in the Chinese market due to the enthusiasm of steel mills for producing HRC. This was driven by improved profits and sales, expectations of demand recovery, and investment in infrastructure and manufacturing. The stock of HRC in major cities declined as transactions increased, with strong speculative demand from traders and terminal enterprises purchasing on demand. Some steel mills in northeast China underwent maintenance in mid-Q1, causing HRC output to fall slightly. Fears of further price increases led to terminal enterprises purchasing primarily on demand, sparking a wait-and-see attitude among terminal operators. Market transactions were average due to speculative demand being greater than terminal demand, and the fluctuation in futures prices led to relatively deserted terminal procurement. Long-term and short-term market sentiment was entwined, and the maintenance of steel mills impacted the supply side. As a ripple effect, the HR Coil (Q235-1 mm) prices for Ex Shanghai (China) settled at USD 686/MT as a ripple effect.
Europe
In the first quarter of 2023, the European market witnessed an unprecedented surge in Hot Rolled Coil (HRC) prices, despite subdued trading. Domestic mills had good order books and limited supplies, which led them to increase their offers in January and March. The upbeat mood of the market was a result of good order books, a lack of competitive import offers, and an anticipated increase in demand. Asian mills increased their import offers after returning from the Lunar New Year holidays, which boosted domestic prices in the EU. Most mills sold all of their first-quarter rolling coils, and there were only a few quantities of March manufacturing material available in the market. Delivery for Asian coils was reported to occur in June or July, which made buyers turn to local coil suppliers. However, some buyers were hesitant to make purchases due to worries that European steelmakers would start operating at higher capacities. End-users were reportedly unwilling to accept increased HRC pricing, and only small volumes were recently traded. As a result, buyers were unsure if the current trend would continue. Consequently, the HR Coil (3 mm) prices for Ex Ruhr settled at USD 925/MT.
For the Quarter Ending December 2022
North America
In the fourth quarter of 2022, Hot Rolled Coil prices in the US market showed a mixed trend due to weakening demand amidst a few positive signs in the market. As steelmakers approached or even met breakeven points, multiple market participants recognized that the Hot Rolled Coil market had reached a bottom in October. High-priced raw materials had higher conversion costs, mainly expensive pig iron inventories and higher-priced scrap inventories. With the Thanksgiving holiday in the United States in November, demand plummeted, and the rest of the year was expected to be slow. However, Hot Rolled Coil prices recovered in December. According to suppliers, HRC spot prices fell in mid-December as the market remained quiet due to the Christmas holiday. On the other hand, steel mills had maintained higher prices and were refusing to lower them. Domestic Hot Rolled Coil manufacturers in the US market appeared optimistic about the new year, but spot pricing remained lower than during the previous summer and fall seasons. Thus, the HR Coil (3 mm) prices for Ex-US Midwest (USA) were fixed at USD 784/MT during the last week of Q4.
Asia Pacific
In the Chinese market, the Hot Rolled Coil prices showcased a stagnancy in their price trend in the fourth quarter of 2022 due to weakened buyers' purchasing activities amidst the relaxation measures on the zero-Covid policy. HRC production increased in October, while consumption increased slowly due to sporadic Covid lockdowns and logistics issues. Buyers were opting for lower prices, while manufacturers claimed the prices had touched the bottom line. In November, the Hot-Rolled Coil prices increased as the traditional peak demand season was gradually approaching the end. Downstream inquiries for hot rolled coils bottomed out in December, pushing prices in the domestic and export markets to five- and four-month highs. China's major flat steel manufacturers, Boasteel, Anshan Iron & Steel (Angang), and Benxi Iron & Steel (Bengang), raised their flat steel offers for January. The three companies agreed to increase hot rolled coil quotations by USD 28.7/MT in December. As a ripple effect, the HR Coil (Q235-1 mm) prices for FOB Shanghai (China) settled at USD 705/MT during Q4.
Europe
Towards the closure of 2022, the Hot Rolled Coil prices edged downward in the German market, despite discounts offered by major suppliers. HRC manufacturers reduced their offers in October to fill order book gaps. Despite this, regional trading activity remained sluggish because buyers had enough material to hold off on new purchases until the mid-first quarter of 2023. In addition, several European steelmakers halted or reduced output in the third and fourth quarters of 2022 to close the supply-demand gap. Long-term contract negotiations between mills and end users in the automotive industry had progressed at higher prices than had been initially targeted. HRC prices remained mostly stable due to conservative bookings, a pessimistic outlook, and weak market conditions. Thus, during the final week of Q4, discussions on HR Coil (3 mm) prices for the Ex Ruhr were settled at USD 719/MT.
For the Quarter Ending September 2022
North America
During the third quarter of 2022, the Hot-Rolled Coil prices witnessed a downward trend in the US market owing to the lower raw material costs. According to market participants, falling feedstock prices were added to the downward pressure. The ongoing decline in Hot-Rolled Coil (HRC) pricing in the United States (US) continued till September, though more significant buys and mill resistance appear to be influencing the market to establish a floor price. Furthermore, buyers were not restocking HRC in warehouses and stated that they could purchase additional tonnes based on demand. Market participants were divided on whether HRC pricing had reached a bottom, with many pointing to the August scrap trade as a leading indicator. According to manufacturers, most buyers are wary of placing large orders. They were concerned about further price reductions. Thus, the discussions for HR Coil (3 mm) prices for Ex-US Midwest (USA) settled at USD 868/MT.
Asia Pacific
Hot-Rolled Coil prices in the Asian market fell in the third quarter of 2022 due to a declining demand outlook. According to buyers, Indian mills increased their offers in mid-August due to deal closures in the Middle East and Southeast Asia. According to market participants, downstream manufacturers have shown limited interest in Indian Hot Rolled Coil quotations. As a result, Indian manufacturers have been hesitant to cite low figures and solicit customer quotations. Indian mills were hesitant to withdraw offers despite low demand in Europe, Turkey, and Vietnam. Lower exports contribute to inventory build-up, forcing steel manufacturers to adjust production accordingly. The monsoon season added to the country's limited demand for steel. Automobile manufacturers have recently reduced casting orders due to massive inventory due to poor car sales over the last three months. Therefore, the HR Coil (2 mm) prices for Ex Mumbai (India) are fixed at INR 57150/MT.
Europe
Hot-Rolled Coil prices have declined in the European market during the third quarter of 2022 owing to a sluggish demand outlook. According to market participants, despite producers pushing for higher levels, buyers' high inventories and weak demand from end-user sectors remain significant issues. European HRC buyers continued to be cautious, with only small tonnages recently traded in the spot market. Several large stockholders claim they have postponed restocking for several weeks because their inventories have been still relatively high, despite a low order intake from end users. Producers have been attempting to secure price increases due to high costs since the beginning of September, but poor demand has hampered price growth. The quotations were ineffective; buyers refused to pay and could not pass the increase downstream. However, most Italian buyers were uninterested in domestic HRC bookings and preferred imported alternatives. Thus, HR Coil (3 mm) prices for Ex Ruhr (Germany) settled at USD 848/MT.
For the Quarter Ending June 2022
North America
During the Second quarter of 2022, the Hot Rolled Coil prices witnessed a see-saw sentiment. In April, the HR Coil prices showcased an upswing trend owing to a constrained supply chain and raw material shortages amidst the ongoing geopolitical tensions. Limited import offers and higher freight rates further increased HR Coil costs. However, some plants in the Midwest witnessed stock availability in late May, while others moved into June. Additionally, because of their extensive inventories, distributors and service centers purchase smaller volumes. The firms are concerned about additional hikes in scrap and energy costs. They are, therefore, reluctant to concede reductions in selling prices. Thus, several market players opted wait-and-watch outlook amidst the stagnant demand.
Asia Pacific
In the Asian market, the Hot-rolled coil market witnessed an upswing trend in the second quarter of 2022 owing to the robust demand since the sanctions imposed on Russia, coupled with the overall uncertainty. As per market participants, global HR Coil prices remained under pressure from the Russia-Ukraine conflict and its ramifications, particularly on raw materials and logistics. The Indian authority levied a 15% export duty on steel, effective May 22, to rein costs to control inflation. Thus, the Hot Rolled prices declined in June due to the weak demand, piled-up inventories, and poor export offers. The prices of HR Coil fell roughly 8-12 percent since the imposition of export duty on steel and allied products. The HR Coil manufacturers are dropping their offers; however, mills are not receiving solid offers from European consumers.
Europe
In the European market, the Hot Rolled Coil prices declined in Q2 2022 due to the limited inquiries, limited transactions, and export restrictions amidst the reduced supplies because of sanctions on Russia. HR Coil prices fell in Russia due to the muted inquiries amidst the reduced supplies because of the sanctions. Since early April, the European Union banned the imports of Russian coal as part of sanctions due to the ongoing war. Furthermore, the sanctions imposed on Russia, coupled with the falling exchange-rate value of the rouble, weak demand, shrinking exports, surplus production, and overall uncertainty, led Hot-Rolled Coil prices to decline in the second quarter of 2022. HRC prices are approaching the pricing floor in the short term, but Russian natural gas outages and the general inflation rate could influence a rebound in flat steel prices.
For the Quarter Ending March 2022
North America
In North America, the Hot-Rolled Coil prices witnessed an inclining trend owing to the tight supply chain and higher input costs during the first quarter of 2022. In contrast, market participants are boosting the hiring of employees to reduce the backlog of unfinished work. Moreover, bulk clients have already secured their needs until May and are waiting for bidding to start in June shipment cargo. Additionally, severe constraints on the supply side raised significant issues as transportation and delays threatened to disrupt operations. However, Import prices for HRC in South America were primarily up amid higher freight rates.
Asia Pacific
During Q1 of 2022, the HRC market witnessed an upward growth primarily due to inflation in raw materials costs especially coking coal. This soaring in raw materials prices is backed by supply disruption due to extended hostilities between Russia and Ukraine. Amidst it, coal prices have trebled in the quarter and reached USD 600-700/tonne from USD 310/tonne. Applying a strict restriction policy to surge the spread of the pandemic in China and controlling carbon emissions have resulted in sluggish HRC production in China. However, the Indian Steel manufacturers have hiked prices of HRC by USD 18-28 /tonne due to inflation in coking coal costs. Indian Steel market players are highly encouraged regarding HRC export as they have already secured enough stockpiles till May delivery.
Europe
Hot-rolled coil prices in the European market increased in the first quarter of 2022 due to solid demand amidst the conflict between Eastern European nations. The ongoing geopolitical conflict between Russia and Ukraine has caused supply chain disruption of various commodities. Russia primarily produces raw materials such as aluminum, copper, coal, and crude oil. In the midst of it all, sanctions imposed on Russia resulted in a blockage in the production and value chain. As a result, rising cocaine prices and imposed sanctions hampered production and supply chains throughout Eastern European nations. Additionally, European steel market players continued to hold back bookings on European-origin HRC due to competitive import offers and complete credit lines.
