The Argus weekly domestic US HRC index rose by $2.50/st to $490.50/st ex-works Midwest today on eight indications from buy- and sell-side sources. The increase is the first since 3 September.
Prices are down by 18pc since early August, and by 34pc since the beginning of the year.
Lead times stayed steady at six weeks with mills remaining booked into mid-December due to planned maintenance outages and some increasing demand.
Prices rose slightly after many US steelmakers announced price increases last week of $40/st for flat-rolled products. One service center source said he bought three months worth of supply two weeks ago to beat the price increase, and that prices rose as much as $30/st in the following week.
Some expect the announcements to set a floor, while a few expect prices to rise quickly. Market participants expect a second price announcement in the coming weeks.
The price increases are expected to pull some first quarter 2020 demand forward in 2019, creating a short term boost but potentially spelling additional softness in early 2020.
A positive sign in the market is the signing of a contract by the United Automobile Workers (UAW) union with General Motors (GM), which one mill estimated will bring 10,000 st/day of steel demand back onto the market.
HRC import prices into Houston stayed at $510/st ddp amid little trading amid the continued low domestic prices.
Plate prices fell by $35/st to $630/st as demand remains low and the price standoff between service centers and mills continues.
The CME HRC futures market rose in the last week, with December futures for HRC rose by $27/st to $540/st. January HRC prices rose by $14/st to $550/st, while February prices rose by $13/st to $556/st. Futures prices top out at a high of $578/st through all of 2020.
Summary of market activity heard by Argus