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    Hot Rolled Futures: Active Market

    Written by Bradley Clark


    The hot rolled futures market has been active this week.  After weeks of very little movement, selling has pushed futures prices into a more dramatic backwardation.  Nearby months such as November and December have fallen $7 to $632.  Further down the curve, HRC prices have fallen slightly more with all months in 2015 falling $8 to $630. 

    Selling down the curve has come alongside concerns over falling iron ore prices and a worsening outlook for Chinese demand. Additionally, the dollar has been strengthening which could cause concern for domestic prices as imports become more attractive.  However, depressed prices in the futures market has not been indicative of the physical market with the spot price staying around $660 and only recently dipping to $656.  Positive data from the U.S. housing and manufacturing sectors were enough to ease concerns from abroad.  While some softening has occurred in the spot market, it is unlikely that a dramatic drop in prices will occur in the near future. 

    Latest in Prices

    Mills seek more scrap after lower prices fail to attract tons

    Several mills that bought October scrap early last week are still asking for additional supplies, scrap market participants said. The reason: the mills' initial prices did not attract enough of the raw material, they said. A trading source based in northern Ohio said three mills have contacted his firm seeking offers for additional tons. He said the mills asked for offers even if prices were higher than their original buys last week.

    Nucor increases spot HR to $1,240/ton

    Nucor said on Monday, Oct. 12, that its consumer spot price (CSP) for hot-rolled (HR) coil will be $1,240 per short ton (st) this week, a $10/st increase from a week earlier. The CSP for HR coil from California Steel Industries (CSI) on the West Coast will be $1,305/st, up $15/st from the prior week. Nucor is still offering lead times of three to five weeks, according to the letter to customers. You can track mill price announcements on our website. Steel Market Update (SMU) published a weekly price assessment on Tuesday, Oct. 6, showing HR coil prices averaging $1,270/st, up $10/st from the previous week. We will update our prices on the evening of Tuesday, Oct. 13.