SMU Price Ranges & Indices: HRC Tumbles

When we looked at the hot rolled coil market this week, it became apparent there were a number of pressures on that particular product. Pressures from short lead times, for one. Some of our sources reported HRC lead times around 2-3 weeks. We also have at least one mill looking for market share with numbers at $650 per ton. We adjusted our range to take into consideration the new competitive pressures, but we wanted to make it clear that the $650 number is not a readily available number out of multiple suppliers. Nonetheless, we are seeing a large number of data points in the $680-$700 per ton area this week. We thought about having two ranges this week – one at $650-$720 and a second at $675-$720. We decided to go with the numbers that are in the market, even if for limited tons, albeit with the explanation we just provided.

The spread between HRC and cold rolled and coated base prices has been averaging approximately $100 per ton over the past few weeks. That average continues if you take out the $650-$660 offers that are skewing the HRC numbers.