The monthly Raw Steels MMI® registered a value of 84 in October, a decrease of 1.2% from 85 in September.
The index however, remains rangebound and pretty flat since March this year. The demand outlook looks positive as global purchasing manager index numbers keep improving. However, the negative commodities environment is holding steel prices from going higher. Moreover, Iron ore prices continue to slump. This weakness in raw material prices seems to be weighting on finished products as well.
Last month, we commented that steel-related stocks were showing some bullish developments but they also fell in September as the US Dollar increased.
What This Means For Metal Buyers
A rising dollar has pushed commodity prices down and this has impacted steel prices as well. While commodities remain at low levels. Steel prices are exposed to a short-term correction, but nothing indicates significant price declines. The long-term outlook remains more positive, although the upside potential will be limited while commodities stay bearish.
The US HRC futures contract spot price fell 5.3% over the past month to $639.00 per short ton. Following a 4.0% decline in price, Korean steel scrap finished the month at $227.59 per metric ton. The US HRC futures contract 3-month price saw a small decline this month, falling from $645.00 to $635.00 per short ton.
At a price of $455.00 per metric ton, the steel billet 3-month price did not budge on the LME the entire month. On the LME, the steel billet cash price remained essentially flat for the month at $450.00 per metric ton. The price of Chinese billet held steady around $506.63 per metric ton last month. Prices for US shredded scrap remained constant this past month, holding at around $381.00 per short ton. Chinese coking coal held pat last month at $226.44 per metric ton. At a price of $602.17 per metric ton, Korean pig iron did not budge the entire month. The price of Chinese slab held steady around $566.90 per metric ton last month.
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.