Monthly Ferrous Futures Report – July 2021

  • Ferrous complex saw inputs of scrap and iron ore fall whilst semi-finished HRC and Rebar were higher. Notably Iron Ore was sold off losing 18% value over July.
  • Turkey Scrap was weaker losing 6% as supply wasn’t tight and dockside stocks grew in Europe and US. Demand was quiet around Eid.
  • Futures activity and liquidity remained in the nearby months. Both LME Scrap and Rebar futures forward curves in a nearby contango as the market anticipates a recovery in prices with scrap restocking in Turkey and rebar demand from China.
  • Turkish steel re rolling mills margins over the last few months as shown by the Scrap-Rebar of $235/mt is at some of highest levels seen for years.
  • Iron ore was sold off in July losing 18% as China domestic demand came off following anticipation of steel production cuts in order to meet their strategic emissions targets. Coking coal remained tight adding +9%. Chinese HRC prices recovered in July steadily through the month to $936/mt.      
  • US HRC continued to increase, adding $83/st on the month, averaging $1,785 on continued tight supply and strong demand.               
  • HRC Europe was largely flat overall (+EUR 10/mt) in a fairly stable market but a divergence with Southern Europe prices weaker.