Hot Rolled Futures Prices Range Bound

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.