For the Quarter Ending June 2023

North America

The US Hot Rolled Coil prices showed an overall declining price trend in the second quarter of 2023, despite of increasing price trend in the initial phase of the quarter, i.e., April. In the first month of the second quarter, the price of Hot Rolled Coil inclined in the US spot market as the local mills maintained a high base price that helped in maintaining a positive market sentiment for domestic and overseas buyers. The delivery time was reduced to 7-8 weeks from the previous 7-9 weeks. This led to a decline in the local inventory levels and hiked the price of HRC in the US spot market. Meanwhile, in H2, the market sentiment for the Hot Rolled Coil plunged as the economic instability increased amid the debt crisis caused by the failure of major banks across the USA. The economic condition worsened as the inflation rate rose, and the approval of the we federal reserve hiked the interest rate. The buyers were shying away from placing large as the US HRC spot market got sluggish. Additionally, The decline in employment rate also impacted the downstream US and infrastructural sector workforce and led to a decline in demand for the Hot Rolled Coil in the US spot market. The local inventory levels were on a higher edge which provoked the US government to impose countervailing duties on the import of HRC from overseas Indian and European suppliers. At the end of Q2, the US government signed a deal to extend the debt crisis further for two more years. This gave hope for the upliftment of the US HRC market for the upcoming quarter.

Asia

The Chinese Hot Rolled Coil prices continuously declined throughout the second quarter of 2023. In April, the price of feedstock such as Coking coal fell amid increased production rate after obtaining profitable margins from the Chinese spot market. The Qingming Festival and heavy rain disrupted the demand and consumption rate of Hot Rolled Coil in China. The export quantity declined as the rising inflation rate and uncertain economic conditions decreased the overseas demand from the US and European markets. Additionally, the export became more straining after the overseas European Union and US government imposition of countervailing duties on Chinese-made steel products. The downstream construction activity was also at a plunging rate as the arrival of the monsoon drastically affected the construction and infrastructural activity across the Chinese spot market. Additionally, the downstream automotive demand was plummeting as the inflation rate hike reduced local customers' buying capacity, leading to an increased supply of Hot Rolled Coil. The Chinese government applied some economic stimulus to overcome the declining price trend of HRC at the end of the Second Quarter of 2023.

Hot Rolled Coils Prices: https://www.chemanalyst.com/Pricing-data/hot-rolled-coil-1363

Europe

In the second quarter, the price of Italian-made Hot rolled Coil increased in the initial phase of Q2, but later overall decline was observed in the H2 of the second quarter. In April, the price of Hot Rolled Coil surged in the Italian spot market. The inventory levels declined in the initial phase of Q2 as the overseas delivery time was delayed from the ArcelorMittal plant in Italy. The downstream automotive industry was also showing a significant growth rate which led to sufficient demand in April and provoked the local Italian Steel mills to increase the price of HRC. Meanwhile, in H2 of the second quarter, the situation decreased; the economic downturn in the global market had adversely affected the market sentiment for Hot Rolled Coil in entire Europe. The labor shortage in overall Europe affected the construction work in Italy also. The declining construction activity reduced the consumption rate of HRC and led to mounting inventory levels in the Italian spot market. Additionally, the automobile industry declined. The European Union imposed dumping duties on the imported Hot Rolled Coil from the overseas Chinese and Indian markets. The Italian government's plans to increase interest rates led to shying tendency from the buyers' side, and this provoked the Italian steel mills to decrease their offer price in the H2 of the second quarter.

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