The US and European Cold Rolled Coil Market Showcase Contrary Trend in May ending 2024

With the week ending on May 31st, US Cold Rolled Coil prices declined, influenced by ongoing debates over domestic mills' base price disclosures. In Germany, Cold Rolled Coil prices rose due to limited availability and increased automotive demand. In the UK, prices increased driven by supply chain disruptions, the Red Sea crisis, and robust demand from the consumer goods and automotive sectors.

As of the end of the week on May 31st, the US Cold Rolled Coil prices saw a further decline of 0.5%. This decrease occurs amid ongoing discussions among market participants regarding the effects of domestic mills making their base prices public. In April, the Producer Price Index (PPI) for metals and metal products, specifically cold rolled steel sheet and strip, experienced a 3% month-over-month drop. Additionally, the PPI for rolled steel shape manufacturing, which includes cold finished steel bars and shapes made from purchased steel, fell by 1.5%, according to information released by the Federal Reserve Economic Data (FRED). Consequently, Cold Rolled Coil prices in Illinois continued their downward trend, reaching USD 1,270 per metric ton by the end of May.

As of May 31st, Cold Rolled Coil prices in Germany saw a modest increase of 0.3%. Buyers have reported limited availability and shrinking material inventories, though this has not led to a rush of panic buying. Sales of German Cold Rolled Coil have grown, leading to extended delivery lead times from German mills and causing some purchasing managers to encounter delays in shipments. Additionally, the automotive sector's strong performance, with a 19.8% year-over-year rise in sales for April, has further fuelled demand for Cold Rolled Coil in the domestic market. Consequently, by May 31, Cold Rolled Coil prices stabilized at USD 900 per metric ton in the FD-Ruhr region of Germany.

Cold Rolled Coil prices in the UK increased by 0.4% driven by several key factors. Supply chain disruptions and destocking activities have notably constrained market capacity, hindering sustained production growth. The Red Sea crisis has intensified these supply challenges and on the other hand boosting the demand for Cold Rolled Coil, thereby adding pressure on the supply side. Additionally, the consumer goods sector continued its strong performance with rising output and new orders. The automotive industry saw a significant 10% month-on-month increase in sales volume in May, underscoring robust demand from downstream sectors for Cold Rolled Coil. As of May 31st, these dynamics led to a weekly price of USD 904 per metric ton in FD-Sheffield, UK.

Based on ChemAnalyst analysis, rising demand from downstream industries in the USA is poised to impact Cold Rolled Coil prices. The construction sector's heightened purchasing activity is expected to contribute to price increases. Additionally, anticipated initiatives by the German government aimed at revitalizing the Cold Rolled Coil industry are likely to exert upward pressure on prices. Moreover, the increasing demand from UK automotive industry could elevate global demand for Cold Rolled Coil, potentially affecting future price trends.