Trading activity for HRC has been sluggish, reflecting cautious sentiments among market participants amidst anticipation of forthcoming price fluctuations. This suggests a need for stakeholders to adopt a careful approach to navigating the uncertainties prevailing in the market. HRC EXW prices were reported at 1095$, down by %2 from the previous week. CRC EXW prices also could not resist the downward trend, falling by 2.4% to $1250.
One notable aspect is the significant price disparity observed between low-carbon (LC) and high-carbon (HC) wire rod prices in the US. The widening gap between January 2023 and January 2024 has been primarily driven by a substantial decrease in low carbon prices, while high carbon prices have remained relatively stable. Import volumes and trade policies, including dumping orders and tariffs, have played a crucial role in shaping this pricing dynamic, underscoring the influence of global trade dynamics on domestic steel prices.
Importing high-carbon products into the US market presents additional challenges due to strict quality standards and regulatory requirements. Domestic mills face pressure to compete against imports by reducing prices for low-carbon products while maintaining stability or even increasing prices for high-carbon products. Quality control measures, particularly regarding rusting and surface defects, contribute to the complexities of importing high-carbon materials, highlighting the need for stringent quality assurance protocols.
Furthermore, US scrap sellers are currently facing downward pressure, with concerns mounting as prices for finished steel, pig iron, and export scrap decline. This negative bias is exacerbated by falling export prices and the overall trend of decreasing prices in the market.
Key price movements in the US steel market, including declines in US pig iron prices and HMS 1 prices, reflect the ongoing volatility and uncertainty in the market. For instance, US pig iron (basic) FOB prices have reported 468$ with a 5.7% decline compared to the last week, while US HMS 1 FOB West Coast prices recorded 383$ indicating a 2% decrease week-on-week. Similarly, US HMS 1/ 2 (80:20) CFR Türkiye prices were declined slightly and recorded as 410$.
However, import volumes of ferrous scrap into the US reached a historic high in 2023, driven by factors such as the expansion of electric arc furnace capacity and a decline in pig iron imports. This underscores the growing reliance on overseas to meet domestic demand.
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