Futures

Hot Rolled Futures Prices Range Bound

Written by Brett Linton

June 5, 2014

The past few weeks have been dire for the futures market in terms of volumes or price volatility. While the physical market has peaked for now, the futures market remains in a strong backwardation with prices for second half the year and calendar year 2015 stuck between 620-630 per ton.

While the global picture, particularly in Asia, continues to deteriorate, the US market has proven resilient as mill discipline has prevented a sharp correction in prices.  Traders remain on the fence as to where prices are headed in the medium term. As the spot softens less than in previous years after peaking in a run up, the strengthening economy and a new round of European stimulus may help to prevent a collapse of domestic pricing in the US.

Volumes have been very thin this week and last, with less than 10,000 tons trading.

If you are reading this from your inbox, the space below contains our interactive graphic of the HRC futures forward curve which also includes what the forward curve was 30 days ago. You can read the newsletter online by logging into the website and then clicking on the “read full text” link at the top of the emailed newsletter or, you can log into the site and then click on the Newsletter tab and Newsletter Archives. The most recent issue will be at the top of the list and you can read the newsletter in its entirety (top to bottom) from there including all interactive graphics. If you need help logging into the website please contact our office: 800-432-3475 or, info@SteelMarketUpdate.com. 

{amchart id=”73″ HRC Futures Forward Curve}

U.S. Midwest #1 Busheling Ferrous Scrap (AMM) Market Settling Flat to Slightly Up

The scrap market began to show signs of life this week as the market started to develop.  Busheling appears to be settling flat to up 10 in the Midwest and Southern markets. This is a bit better than was initially expected, as steel demand remains robust and the export market remains steady.  The futures market has been quiet yet again for the busheling contract, but bids are prevalent down the curve at 385 per ton with no aggressive sellers looking to get short at these levels.

Another interactive graphic is below:

{amchart id=”74″ BUS Futures Forward Curve}

Brett Linton

Brett Linton is a senior analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.

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