Q2 2022 Steel Report Overview

US HRC prices rebounded 5% Q-o-Q, primarily as a result of a severe shortage of Pig Iron. Forecast: sideways

Although the market is facing a pig iron shortage and rising scrap prices, new capacity ramping up combined with ~72% Y-o-Y growth in import volumes, largely driven by the pull-back of Section 232 tariffs, are likely to correct the market.

EU HRC prices surged 44% Q-o-Q, driven by sanctions on Russia energy and steel products. Forecast: Increase

Due to high energy and input costs, EU steelmakers are cutting production, coupled with lower import volume from Russia and Ukraine (together account for one-third of Europe’s steel imports), EU steel market is facing tight supply and extremely high production costs. 

CN HRC price went up by 5% Q-o-Q, driven by multi-year low production levels. Forecast: sideways

CN HRC price is likely to remain at the current level, given that both supply and demand are constrained by the latest COVID restrictions in various parts of the country; environmental restrictions and increased M&A activity will support the price level.