US hot rolled coil (HRC) prices dropped further on Tuesday against a backdrop of uncertain demand with a a possible strike at three major US automakers looming later this week.
The Argus US HRC Midwest and southern assessments both fell by $30/st to $690/st ex-works, the lowest since the start of 2023 and down by 43pc from the April peak.
Repeatable offers were reported between $680-700/st, with many unwilling to purchase on the spot market given the uncertainty around where demand will go in the coming days.
Large discounts were reported for a range of potential tonnages from 2,000-20,000st. The lowest reported price for the larger end of the volume range were reported at $610/st, though no deals were confirmed.
Lead times remained flat at 4-5 weeks.
The market waited to see if the United Auto Workers (UAW) will strike some or all of the Big 3 automakers this week when their contract expires on the night of 14 September.
A strike at Ford, General Motors (GM) or Stellantis would curtail consumption of thousands of tons of steel, aluminum, and other metals associated with auto production. An update is expected to be given by UAW president Shawn Fain on Wednesday.
Both sides have remained far apart, with the union giving a headline demand of at least 40pc wage increase while Stellantis has countered with the highest base wage increase of 14.5pc. That offer, along with ones from Ford and GM, have so far been rejected by the UAW.
The biggest impact to steel consumption would likely come in the Midwest, where most of the affected auto plans are located. Other automakers like Honda, Toyota and others would be unaffected as they do not have unionized workforces.
The HRC import ddp Houston assessment fell by $10/st to $690/st on lower offers.
The Argus US plate assessment fell by $25/st to $1,490/st ex-works. Lower domestic offers weighed on pricing with repeatable levels between $1,460-1,520/st.
Lower prices imports are also weighing on the market, and multiple sources reported they believe at least one steelmaker may make a downward price adjustment soon.
Lead times were flat at 4-6 weeks.
Delivered plate pricing also fell by $25/st to $1,530/st on lower offers. argusmedia
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