Steel Products Prices North America

Met Coal Prices: Supply Outpaces Demand
Written by Sandy Williams
March 11, 2014
Met coal prices are plummeting and oversupply is the problem, says Goldman Sachs. On Friday, Goldman cut its metallurgical coal average price estimate for 2014 to $141 per metric ton from $150 due to higher Australian output and slower demand from China along with “limited U.S. supply rationalization.”
Bank of America Merrill Lynch agrees that miners need to idle capacity to return to more normal pricing but global producers are unwilling to do so. BofAML says the “seven-year low met coal spot prices as reported by Platts reflects a deeply troubled market.”
As of Friday, March 7, Platts reported spot premium low-vol met coal prices FOB Australia were $113.25 per metric ton, down from $119.30 per metric ton the previous week.
Platts says coking coal prices have dropped nearly 30 percent over the past year. Normally, monsoon weather in Australia will slow down exports and push prices up, but the normal pattern hasn’t emerged so far this year.
“Everyone is pointing to potential reasons for the weaker prices, but it most likely comes down to supply-demand fundamentals,” said Platts in the latest issue of Steel Raw Materials Monthly. “The market for hard coking coal is oversupplied and demand is lackluster due to weak steel prices and production in China.”
At the Coaltrans USA Conference last month in Miami, conference participants concurred that global oversupply is a problem. Coltrans USA attendee Ernie Thrasher, CEO of Xcoal, a leading US met coal supplier, estimates that it may take two years to recover from lower revenues and supply rationalization.

Sandy Williams
Read more from Sandy WilliamsLatest in Steel Products Prices North America

SMU Price Ranges: Sheet and plate steady ahead of Independence Day
Sheet and plate prices were little changed in the shortened week ahead of Independence Day, according to SMU’s latest check of the market.

Nucor maintains plate prices, opens August order book
Nucor aims to keep plate prices flat again with the opening of its August order book.

Nucor CSP remains level at $900/ton
Nucor maintained its weekly list price for hot-rolled (HR) coil this week, following two consecutive increases.

Cliffs raises prices, seeks $950/ton for July spot HR
Cleveland-Cliffs plans to increase prices for hot-rolled (HR) coil to $950 per short ton (st) with the opening of its July spot order book. The Cleveland-based steelmaker said the price hike was effective immediately in a letter to customers dated Monday.

HRC vs. prime scrap spread widens in June
The price spread between HRC and prime scrap widened in June.