Since August 2020, the price of US HRC steel has increased nearly 4 times compared to the starting level of only 440 USD/ton.
Steel prices are continuing to rise rapidly, setting new records thanks to strong recovery in demand in key markets while supply is scarce, raw material costs are rising and inventories on the supply chain are low.
In particular, steel prices in the US are rising very fast due to deep-rooted reasons both on the supply side and the fishing side. The US price of hot rolled coil (HRC) recently surpassed the $1,700 mark for the first time since this rally started and is forecast to continue to rise.
Since August 2020, the price of US HRC steel has increased nearly 4 times compared to the starting level of only 440 USD/ton. In the context that demand continues to outpace supply as at present, there is still a lot of room for price increases. Analysts predict that the unprecedented increase will last into the third quarter because the basic supply and demand factors will not change much.
The recovery of industrial production led to a sharp increase in demand. Across industries from auto, construction and mechanical engineering, factories are jubilantly reopening. In which, automobile and construction are the two most steel consuming industries.
There are also huge infrastructure spending packages for both the US and China. According to predictions by the World Steel Association (WSA), steel demand will increase by 5.8% in 2021, to 1,874 tons after a decrease of 0.2% last year. Particularly in the Chinese market the figure is 3%.
While demand is strong, supply is still very limited because of production disruptions. This is also combined with the low amount of steel imported into the US due to high import tax, causing the supply to be tight. The price of scrap iron, the main input material for steel furnaces using electric arc furnaces, also increased sharply.
T&G International Joint Stock Company
Address: 352 Hue Street, Le Dai Hanh Ward, Hai Ba Trung District, Hanoi
Hotline: 0345786803
Email: hrm@tginterjsc.com
Website: http://tginternationaljsc.com
