Hot Rolled Futures: Stagnant in a Slow Market

The hot rolled coil (HRC) futures market has been very flat in terms of pricing over the past few weeks with the Q4 trading around $645, Q1 $650 and calendar 2015 around $645.  All prices are very flat down the curve, indicating a slight decrease in pricing from current spot levels.  Overall, good volumes have been trading the past couple of weeks with over 20,000 tons going through on nearby periods.  This increase in volumes, while positive for liquidity, hasn’t moved prices in either direction, all done at recent trading levels.

The futures market seems to be under the same malaise as the physical market.  While prices remain stable in the physical market, and further domestic consolidation and potential for new trade cases to be filed seem to provide an underlying bullish feel, activity levels remain subdued. It really seems for both the physical and futures market the story of low volatility and thus stable pricing and a stable market is the story of the year and the moment.