Futures
January 5, 2017
Sleepy Start to 2017 for Ferrous Futures
Written by David Feldstein
The following article on the hot rolled coil (HRC) futures markets was written by David Feldstein. As Flack Steel’s director of risk management, Dave 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, Dave produces articles that our readers may find interesting under the heading “The Feldstein” on the Flack Steel website www.FlackSteel.com.
Midwest HRC futures have been relatively quiet to kick off the New Year. Yesterday, February traded up to $633/st while the back half of the year traded up to $609. The curve has moved into a decent backwardation perhaps due to expectations that additional capacity will pressure prices lower, even in the face of very low flat rolled inventory levels, falling imports, record auto sales, growing construction and an impressive December ISM PMI. Perhaps service centers and OEMs are still proceeding with caution following two years of increased volatility.
