Prices for hot-rolled and cold-rolled coil in the US are expected to bottom out by the end of the year, sources said Tuesday.
Platts maintained its daily HRC and CRC assessments at $360-$370/st and $490-$500/st, respectively. Both prices are normalized to a Midwest (Indiana) ex-works basis.
Any further erosion from current price levels was expected to be minimal, while available prices in the market were heard to remain compressed.
"You have reached that point where 1,000 st or 100 st [orders] would not see much of a difference in terms of pricing," a buy-side source said. He would not be shocked, he added, if mills announced a price increase before the end of the year but said it would be a "psychological move."
The mentality seems to be prices are at bottom and that distributors and original equipment manufacturers would support an increase but there is no data to back up why prices should rise, he said. General HRC offers were starting at $360/st but firm orders could achieve lower prices, he added.
Multiple sources reported that two mini-mills were not currently quoting material for January delivery as they anticipated improved spot pricing at the start of next year.
One of those sources, with a Midwest service center, said he thinks there was a "very high likelihood" that mills will announce an increase before the end of the year. However, he was not sure what would make an increase stick.
HRC for large volume, significantly higher than the Platts maximum lot size of 500 st to be considered in the assessment, was difficult to get to $340/st, he said. When he was offered HRC at that level, it was at a freight disadvantage to other offers closer to $350/st, he said. There is not a large enough spread to incentivize placing the larger orders, he added.
A second buy-side source said "everyone is expecting" an attempted price increase before the end of the year but market fundamentals justifying higher prices remained sparse. Available prices were tight, with some one-offs heard at $340/st, but most at or above $350/st, he agreed.
