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Steel Blog

Hot Rolled Futures Markets Grinding Higher

Friday, March 18, 2016 12:46 PM Written by
Published in Hot Rolled Futures

The following HRC and BUS futures market trading article was written by Jack Marshall of Crunch Risk, LLC. Here is how Jack and Andre Marshall saw trading this week and what the forward curve looks like:

HR futures continue to grind higher. While HR demand seems to be holding steady we are starting to see some structural shifts in supply which have really helped give HR futures a bid tone lately. This week the anti-dumping duty announcements by the  Commerce Department have re-enforced the expectations of import supply disruptions from record high import levels. We are seeing lengthening HR lead times, further HR price increase announcements for plate & sheet, modest inventory levels, and rising scrap exports from historically low levels due to quickly rising prices. The combination of all these dueling supply drivers along with announced integrated mill closings and falling capacity utilization rates appear to be slowly shifting sentiment in the HR space. The one caveat to this more bullish view could be the fickle price of iron ore, which gave back much of its recent price gains.  Oh yes,  and there is that extra 100 million tons of excess capacity Chinese steel!


Hot Rolled Futures Trading Rallies This Week

Friday, March 04, 2016 2:39 PM Written by
Published in Hot Rolled Futures

The following article on the hot rolled coil (HRC), busheling scrap (BUS), and financial futures markets was written by Dave Feldstein. As Flack Steel’s director of risk management, David Feldstein is an active participant in the hot rolled coil (HRC) futures market and we believe he will provide insightful commentary and trading ideas to our readers. Besides writing Futures articles for Steel Market Update, David produces articles that our readers may find interesting under the heading "The Feldstein" on the Flack Steel website.


Hot Rolled Futures: Pit in Your Stomach

Friday, February 12, 2016 4:31 PM Written by
Published in Hot Rolled Futures

The following article on the hot rolled coil (HRC), busheling scrap (BUS), and financial futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. Assisting Andre with tonight's article is Jack Marshall also associated with CrunchRisk. Here is how Andre and Jack saw trading over the past week:

Financial Markets

The S&P 500 is in midst of retesting recent lows and has broken them by a smidge today, essentially testing the 1800 zone, the low on the March future was 1802.5 and the low on the S&P index was 1810 zone – the most recent last low was 1814 as reference. As I have mentioned, we are likely headed for that 20% correction area of 1700-1750, and maybe lower, however, the next move may be back up to 1900 area, basis the March future price, with first resistance at 1840.

We’re more or less about the halfway point on this current downward larger correction, and so now is not really a good time to lighten up if you haven’t already. At the correction point, 20% or 25% or 30 %, we will then rally hard again looking to retest the old highs at X number of weeks or months forward. Where-ever we may be “when?” we fail to test those old highs, is the best moment to lighten up - you just have to remember the “pit in your stomach” feeling you have right now to lighten up when it’s sounding all bullish again then, haha! – good luck with that.


The following article is written by Spencer Johnson of FC Stone LLC. With six years of experience, Spencer provides his customers strategic and tactical advice on protecting themselves against commodity price volatility in the steel markets. Spencer will rotate weekly futures articles with Andre Marshall of Crunch Risk, LLC. Spencer can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..


Hot Rolled Coil Futures Trading Through October 22nd

Friday, October 23, 2015 2:05 PM Written by
Published in Hot Rolled Futures

The following article on the hot rolled coil (HRC), busheling scrap (BUS) and iron ore futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. The article was published in Thursday evening's issue of Steel Market Update. SMU publishes articles on the Futures markets every Thursday in an effort to keep our members up on where the money is thinking HRC, scrap and iron ore will trade in the physical markets in the future. Here is how Andre saw trading over the past week:


Hot Rolled Coil Futures: Broken Support

Friday, September 25, 2015 3:47 PM Written by
Published in Hot Rolled Futures

The following article on the hot rolled coil (HRC), busheling scrap (BUS), iron ore and financial futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. Here is how Andre saw trading over the past week:


Hot Rolled Futures: Capitulation

Friday, September 18, 2015 1:35 PM Written by
Published in Hot Rolled Futures

The following article on the hot rolled coil (HRC), busheling scrap (BUS), iron ore and financial futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our Managing Price Risk I & II instructor. Here is how Andre saw trading over the past week:


HR Futures Trading: WOW!

Friday, September 04, 2015 12:06 PM Written by
Published in Hot Rolled Futures

The following article on the futures markets was written by Andre Marshall, CEO of Crunch Risk LLC and our instructor for our Managing Price Risk I and Managing Price Risk II workshops. Andre attended the SMU Steel Summit Conference on Tuesday and Wednesday of this week in Atlanta. Here are his comments about both the conference and the markets:

Comments from an awesome conference:

Wow! That was maybe the best conference I’ve ever attended, and I heard similar comments from everyone else.

Wow! Everyone is bearish, and I mean everyone! I didn’t talk to one soul at the conference who had anything positive to say at all, well maybe one. In the trading world, there’s a philosophy of trading that says that “if everyone has the same point of view, take the other side” i.e. be contrarian. The theory goes that for any trade, you have to have a buyer and seller, and if everyone wants to sell chances are the market is already pushed down below where it should be, looking for that elusive buyer (only buyers, in theory, would be speculators looking for a big payback i.e. a low buy level). Problem with this is, at some point, the price level reaches a point where the sellers die off because it’s even too low for them (i.e. $450 bid Q4’ 15 today, any takers?), but now, a lot of folks are short (short could also mean you  have to buy steel as a part of your business and haven’t been doing so) and if there is any sign of stabilization, or an increase, the next offer available for a buyer is way above, like a vacuum. That’s what’s at risk here in steel right now despite all of the data points to suggest much lower still.


The following article is written by Spencer Johnson of FC Stone LLC. With six years of experience, Spencer provides his customers strategic and tactical advice on protecting themselves against commodity price volatility in the steel markets. Spencer will rotate weekly futures articles with Andre Marshall of Crunch Risk, LLC. Spencer can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..

As is so often the case, US Steel has chosen a particularly interesting time to begin a push for their $40/ton price increase on all flat-rolled products, and that’s without even diving too deep into the fact that a looming Grexit is stoking fears of an economic contagion in Europe. You know it is not a good sign when a huge financial crisis potentially looming in Europe doesn’t even make our top 3 reasons to be skeptical of pushes for higher steel prices. Granted, spot prices have stagnated around the $460/ton mark and mills would no doubt like to see a little rally, but the fundamental story behind this increase is weak, which is likely why no rationale was given by USS in their original increase letters that we have seen. Those letters, which came on Tuesday, had been more than welcome on the part of the bulls but we see the deck being stacked against the US mills on this issue for three reasons. Note that we do believe prices will indeed get a $40/ton boost, we just don’t see this happening in the short-term but instead as part of a long slog that will likely get us there sometime in the fourth quarter (in short, we are in agreement with the NYMEX HRC contango levels as being a fair estimate, more on that below).


Slide Continues for Hot Rolled Steel Futures

Thursday, February 12, 2015 8:54 PM Written by
Published in Hot Rolled Futures

The following article on the futures markets was written by Bradley Clark, Director of Steel Trading at Kataman Metals.

The erosion of hot rolled coil prices continued this week with prices down in both the physical market and futures market.  In the physical market, the CRU was down approximately 1 percent this week to $537/ton.  In the futures market, the first half of the curve is flat with trades for Q2 being done at $535/ton.  Nearer months have been trading $5/ton lower.  The back half of 2015 is higher with trades being done between $560 and $570. 


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