US hot-rolled coil prices softened further Thursday amid lower buying activity, according to market sources.
S&P Global Platts lowered its daily HRC assessment to $610-$630/st, reflecting a $620/st midpoint. This is down from $620-$635/st. The cold-rolled coil assessment held steady at $790-$820/st. Both assessments are normalized to an ex-works Midwest (Indiana) basis.
A service center source who was able to book a small HRC order at $610/st from a mini-mill said it's likely he could have bought at $600/st if he had more tons to purchase, adding he would be skeptical of buying anything over $620/st.
"We're not selling as much as we'd like, and we're not buying as much as we'd like. ... It's tough figuring anything out right now," he said. "All of a sudden, since the end of last week and into this week, it's like the bottom fell out of activity and nothing's happening."
A second service center source said he has seen his HRC price drop $20/st in the past month, but didn't expect prices to fall back much further. He anticipates pricing will stay in the current range -- plus or minus $20/st -- for the balance of the year, supported by stable scrap pricing, the rising HRC price environment happening globally led by China, lower volumes of imports to the US market, as well as outages and reduced operating rates at domestic mills in the fourth quarter.
However, another service center source, who was being quoted $620/st on HRC, didn't see the same stability in the market.
"Since scrap didn't go up and the Chinese market may be coming down now, it could psychologically effect our markets also," he said.
A fourth service center source said he was having trouble getting a handle on the current HRC market as inventory levels have been high as a result of buyers stocking up on imports in June and July ahead of an expected decision in the US Department of Commerce's Section 232 investigation. The investigation, which began in April, aims to determine if steel imports threaten national security, and the probe could result in the introduction of tariffs, duties or other measures.
"I think people are trying to figure out where the market is," he said. "If you don't know the price in the marketplace, you buy what you need. People aren't taking a huge position on inventory."
Cold-rolled coil and galvanized substrate pricing was heard to be more solid Thursday, according to market sources. However, the first service center source said a mill agreed to sell him galvanized sheet substrate base below their original offer at $800/st.
