Steel Products Prices North America

June Flat Rolled Steel Pricing Confidence Eroding

Written by John Packard

Last week Steel Market Update conducted our mid-May flat rolled steel market analysis. We thought it would be interesting to compare what our respondents were thinking last week compared to the beginning of May regarding where hot rolled coil spot prices might be by the beginning of June. What our survey discovered was our respondents are less enthusiastic regarding steel prices moving higher by the beginning of June than they were a couple of weeks earlier.

At the beginning of May our respondents were split on the direction of benchmark hot rolled pricing: 47 percent thought HRC prices would go sideways, 34 percent believed prices would move higher and 19 percent were of the opinion spot prices would drop by the beginning of June.

Last week our respondents answered the same question with the following results: 49 percent sideways, 14 percent higher and 37 percent lower.

We also asked where they thought base prices on benchmark hot rolled would be on June 1st. As you can see by the graphic below, from the beginning of May until this past week the average dropped by $8 per ton from $688 to $680 per ton (last week our SMU HRC average dropped by $10 per ton to $675 per ton).

One of the comments left behind during the survey process was from a manufacturing company who reported to SMU, “Typically when the market goes up as fast as it did, it comes down just as fast. I’m hearing of some deals being made and lead times contracting. I expect to see this drop pretty quick.”

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