US steelmakers expect stable steel demand in 2024

At present, prices for steel coils in the country have declined from their peak at the end of 2023

Last year, steel demand in the US was stable and should remain so in 2024. This opinion was expressed by the heads of American steel companies, according to World Steel Dynamics.

Mark D. Millett, Chairman and CEO of Steel Dynamics, told analysts that he was confident in the steel demand forecast for 2024. He emphasized that for most of last year, customers’ stocks of steel products were below historical averages, and this trend has continued.

Millet also commented on the recent decline in hot-rolled steel prices in the US. According to him, the flat products segment continues to be stable for the company, and despite the not-so-constructive macroeconomic environment, Steel Dynamics’ order intake rate in January was high.

According to the CEO of Steel Dynamics, the spot price for hot rolled coil (HRC) is not as reliable a signal for the industry as it used to be and does not always reflect the level of demand, as few spot deals are currently being made.

Lorenco González, chairman, president and CEO of Cleveland-Cliffs, told analysts that $1,000 per short ton is a good price for HRC. Since the last announced price increase (January 3) to $1150/mt, up from December’s increase to $1100/mt, the company has been making deals at this higher level in some cases. However, the overall market price is still lower, so the situation is ambiguous.

González also explained that since the end of September last year, Cliffs has made six price increase announcements. The company practices these steps until it realizes that the market has reached a point where it can no longer put pressure on it.

Nucor expects firmer pricing going forward. According to Steve Luxton, Nucor’s Executive Vice President and Chief Financial Officer, the company’s shipment volumes increased at the end of the fourth quarter, which helped it sell its flat products at higher prices in line with price trends in published indices. He added that the company expects further improvements in both shipment volumes and pricing to have a positive impact on results in the first quarter of 2024.

At the same time, 62% of respondents to a WSD survey conducted on LinkedIn expect hot rolled coil prices in the United States to be less than $1,000 per short tonne by the end of the first quarter of this year, while 14% expect them to exceed this figure. However, the main price indices are now reporting lower HRC prices. For example, on February 9, Platts lowered its estimate for hot rolled coil in the US to $900 per short ton.

The survey notes that producers expect stable demand and prices in the future, but steel futures are trading significantly lower. According to one commentator, mills can accept orders at prices below $1,000 per short ton depending on their volume.

As GMK Center reported earlier, global hot-rolled coil prices have risen in major markets since the beginning of 2024. In Europe, quotes were supported by a low supply of locally produced products and the exhaustion of import quotas. In the US, the trend is similar, but supply still exceeds demand, which is holding back price growth.