Q3 2022 Steel Report Overview
Regional HRC price trends diverged globally in Q2 with US drop 34% Q-o-Q, EU plummeted 39% and China down 25% over the same period. HRC prices fell globally under the backdrop of the Fed’s interest raise. Steel market brushed off the latest disruptions and swung back into full correction.
- US HRC prices fell by 34% Q-o-Q as the Fed sought to curb the economy to combat inflation. Weakened demand, high import volume, lower scrap and pig iron prices coupled with the Fed’s conviction to rein in inflation via further interest rate hikes, HRC price in the US will likely slip further in the near-term.
- EU HRC prices have plummeted by 39% Q-o-Q to €851/MT in Jul’22, the lowest in 16 months. The price downturn was mainly the making of market correction following overstocking for the Russia-Ukraine War. While EU mills have begun to cut output due to thin margin, high energy prices as well as a weak Euro will likely provide support for EU HRC price in the coming quarter.
- CN HRC fell by 25% in Q2’22 with a weak prospect due to COVID uncertainties. Cool down of the real estate sector and concern over China’s pandemic measures will likely continue to pressure CN HRC downwards. The market reacted tepidly to Beijing’s ~$60 billion stimulus package when announced in late May.