JPM Steel | Daily Despatch: US spreads +1%; copper scrap +3%; AZZ raises FY27 guidance; SMU scrap sentiment survey

Research evidence excerpt

JPM Steel | Daily Despatch: US spreads +1%; copper scrap +3%; AZZ raises FY27 guidance; SMU scrap sentiment survey

nue to report limited mill negotiability: SMU’s latest survey shows 18% of respondents said

mills were willing to talk price to secure an order, up 6pts points from its late June survey, which marked the lowest reading

since September 2021. Hot rolled: 30% of buyers said mills are negotiable on price, up 19pts from our prior survey. This is the

highest rate recorded since January. Source: SMU

• US steel industry, except for Cleveland Cliffs, calls for pig iron tariff exemption: Most of the industry’s largest players

believe the US produces insufficient supply to make up for a trade barrier on Brazilian pig iron, and a tariff would only raise

their costs. Ohio steelmaker Cleveland Cliffs, which produces pig iron in the US, took the opposite view, defending a tariff on

the metal. Source: Platts

• China’s bond issuance surge fails to lift rebar demand as mills cut output: China’s increased infrastructure funding has

done little to revive demand for construction steel, with rebar consumption continuing to weaken despite local government

special bond issuance more than doubling in June, China-based steelmakers, traders and analysts said over July 8-9. Still,

production cuts triggered by loss-making sales may prevent rebar prices from falling further, according to market participants.

New local government special bond issuances were up 8.5% YoY. Source: Platts

• US ferrous scrap prices may fall in July as steelmakers push for cuts: US ferrous scrap prices had the potential to decline

in July for some obsolete grades as some steelmakers bid for $10/lt MoM price cuts for July-delivered shredded and HMS

July 9, market sources said.