Flat rolled prices continue to hold steady worldwide, creating flat pricing for both domestic and import. Energy markets continue to pick up steam propping up carbon steel prices.
Hot-rolled coil prices are still on the rise, mainly due to the surge in energy tubulars. American Metal Market's latest assessment in late March pegged U.S. prices at around $660 per ton with some April quotes said to be going out $20 higher. Hot-rolled coil had risen more than 5.0% in the first three weeks of last month and had surpassed its 2016 highs. However, prices were beginning to reverse in Asia and analysts think that trend will soon hit the U.S. market, so hot-rolled coil may be at its zenith.
Iron ore prices were dropping at the end of March after a long run-up that had seen iron rising more than 50.0%. Meanwhile, iron ore is said to be piling up at Chinese ports. The situation has led MEPS International to predict global steel prices are headed for a downturn.
Finished steel import market share stood at 25.0% in February, according to data from the U.S. Census Bureau highlighted by the American Iron & Steel Institute. Year-to-date through two months of 2017, total and finished steel imports were up 11.7% and 1.1%, respectively, vs. the same period in 2016. Major products with significant YTD import increases compared to the same period last year include oil country goods and standard pipe, up 87.0% and 19.0%, respectively.
The global steel capacity glut will only worsen, according to the Organization for Economic Cooperation and Development (OECD). It pegged world steelmaking capacity at 2.39 billion tons per year at the end of 2016, up 1.4% from 2015. The OECD’s steel committee said new capacity was added at a faster rate than old capacity was shut and capacity utilization rates are still low despite a four-percentage-point gain to 70.3% in February, according to the World Steel Association. That same group reported crude steel production for its 67 member countries was up 4.1% in February 2017, compared with the same month in 2016, even though February had an extra day last year.
China remains the main culprit contributing to the global glut. The National Bureau of Statistics of China reported its crude steel output rose by 5.8% through the first two months of the year. As reported last month, China’s pledges to cut capacity amount to a lot of smoke and mirrors as it counts closures of plants previously shut down while continuing to open new steel plants.
U.S. service center steel shipments decreased by 1.7% percent from February 2016, according to the Metals Service Center Institute. The slowdown followed on the heels of a 9.4% year-to-year gain in January. Steel product inventories decreased 6.4% from February a year ago.
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