HRC Futures Quiet While Busheling Breaks Lower and Iron Ore Attempts to Rally

SMU Contributor David Feldstein is president of Rock Trading Advisors (davidfeldstein@rocktradingadvisors.com, twitter @TheFeldstein). In addition to market analysis, RTA provides price risk management not only for ferrous products, but also base metals, energy and interest rates. RTA also trains sales staff and creates the infrastructure necessary for firms to offer their customers fixed pricing on physical sales.  

Due to a shortage of scrap creation resulting primarily from the shutdown of the automotive industry in April, Midwest busheling experienced a supply shortage, which drove its price higher while most other commodity markets were in freefall. June and July busheling had been trading in the $330-$340 range since mid-May until Tuesday when aggressive selling pushed the curve $15-$20 lower. With a week to go until the June scrap settlements, the expectations of a $10-$20 increase for Midwest busheling looks to have adjusted lower, pointing to a flat to $10 MoM increase.