Q2 2020 Steel Report Overview

Global Steel prices saw a final upward push in January before the impact of COVID-19 turned the market downwards. Now in April, most steel prices have fallen between 4 and 16% since January. The most significant downward movement occurred first in China and then in the US markets.

• The US HR price increases that began in Oct 2019 have nearly been erased in early 2020, as prices dropped 16% in Q1, starting April at ~$560/MT.
• EU HR prices surged 14% in Q1 2020, the first significant upward movement in pricing in over two years as buyers looked to increase their stocks during a panic buy caused by news that the Italian mill Ilva would potentially close and cause a significant supply shortage. The potential closure stems from ongoing negotiations between Arcelor and the Italian government rather than COVID-19. After peaking in March, prices have started falling in line with the rest of the market as demand and production have fallen off.
• China’s HR price plummeted ~15% Q-o-Q as it became the first country to experience the impact of COVID-19. Prices have yet to rebound, although demand and production have recovered nearly back to pre-COVID levels.
• Scrap prices rose 14% in the US, and 3% in Europe, but fell -3% China, while Iron Ore prices softened -1% over the same period. Coking Coal prices surged 17% in Q1, due to supply concerns in China/Australia.

As always, we look forward to hearing your questions and comments

The Steel Team at Applied Value