MetalMiner’s raw steels price index slipped two points this month to 89 due to falling HRC prices, both on the exchanges (LME and CME) as well within transactional price markets for the US and China.
“The US steel industry still looks like a mixed bag to us,” said Lisa Reisman, managing editor of MetalMiner. “For example, the ABI (Architecture Billings Index) showed growth in January and consumer confidence also showed growth in February, but mill capacity utilization fell to 77.5 from 80.4 one year ago for the week ending March 2.”
Certain sectors have momentum (e.g. housing, oil and gas, particularly rig counts), automotive and service center measures of MOH (months-on-hand inventory) still appears slightly below historical averages, but US industrial construction spending appears to be running lower than 2012 figures for the same point in time (January), potentially offset by rising Canadian industrial construction spending.
The impact of the March 1 sequestration may also negatively impact the steel sector.
Primary Price Drivers of Steel Index
Korean pig iron prices fell 12.1 percent to $585.46 per metric ton. The cash price of steel billet dropped 11.1 percent on the LME to $240.00 per metric ton. After remaining essentially unchanged the previous month, the price of US shredded scrap fell 3.9 percent to $374.00 per short ton. The spot price of the US HRC futures contract closed the month down 3.0 percent at $614.00 per short ton. Chinese billet prices dropped 1.5 percent to $536.68 per metric ton. For the second month in a row, the 3-month price of the US HRC futures contract declined, falling 1.1 percent over the past month to $638.00 per short ton.
Chinese coking coal traded sideways last month, staying around $287.62 per metric ton. Last month was consistent for Chinese slab, which did not move from $634.70 per metric ton.
The Raw Steels MMI® collects and weights 13 global steel and raw material price points to provide a unique view into global steel price trends over a 30-day period. For more information on the Raw Steels MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.