Market Update | February 23, 2022



The developing situation between Russia and Ukraine have caused energy prices around the globe to sharply increase. Key steel input costs such as crude oil and natural gas are at elevated levels this week, with crude oil up to nearly $95 dollars a barrel.



Zinc pricing remained firm this week after a sharp increase to start the New Year, as zinc pricing has now remained over $1.60/lb for forty consecutive readings.

– Zinc pricing remained at slightly above $1.65/lb this week; holding at that level since the week before Christmas.
– However, longer-term forecasts expect pricing to return to the recent $1.40/lb-$1.45/lb average.

Spot iron ore pricing slipped this week, sliding below $140/mt for the first time in nearly three weeks.

– Spot iron ore pricing is down 7.0 w/w, pricing is still up 1.2% m/m.

Pacific basin met coal pricing continued to climb this week and hit a fresh all-time high.

– Met coal pricing climbed to $444/mt, up 8.6% from last week.

The recent tensions in Eastern Europe between Russia and Ukraine have pushed energy prices around the globe sharply higher.

– Crude oil pricing is up near $95/barrel early this week, while natural gas pricing is up as well.



After declining for four consecutive weeks, domestic raw steel production inched higher last week.

– U.S. steelmakers produced 1.764 million tons at a 80.1% utilization rate.
– Year-to-date production is 3.2% above the total from the same period last year.

This week, Cleveland-Cliffs announced the indefinite idling of the #4 blast furnace at their Indiana Harbor location.

– The IH#4 furnace, which has a production capacity of 2.1 million tons/year, is expected to cease production within the next two months.
– Combined with the 100 day outage at the Cleveland Works, this will reduce Cliffs operating blast furnaces from eight to six.
– With both Indiana Harbor blast furnaces #3 and #4 now indefinitely idled all downstream operations will be supplied exclusively by the their flagship IH#7 blast furnace.

January global steel production averaged 5.001 million metric tons/day, down 2.0% from December and down a sharp 6.1% from a 5.326 million metric tons daily average in January 2021.

– ​The drop in January came from China, which declined 5.2% from December and was down 11.2%, on a year-over-year basis.
– Chinese production has now dropped, on a year-over-year basis, for seven consecutive months.
– North American production inched higher in January, ending a streak of four consecutive monthly declines.
– The boost in NA production came from the U.S., which saw production increase 2.3% from December to a 234k mt/day average.



Disruptions from key material shortage, both from the chips and the recent Canadian border protest, helped to push U.S. light vehicle production lower in January.

– January light vehicle production totaled 708,976 units, up 3.6% from December but still well below (8.9%) year-ago levels.
– While production of cars slipped, on a month-over-month basis, in January, light truck production increased slightly.



According to Platts, HRC pricing around the globe continues to see an uptick.

– Asian HRC prices increased again last week, ending the week at $812/mt.
– This is up 4.1% w/w and 7.8% m/m.
– Spot HRC prices in Northern Europe slipped slightly last week but remain up 4.9% m/m at $1,098/mt.

Along with their recent announcement to idle the #4 furnace at Indiana Harbor, Cliffs announced that they are increasing current spot market base pricing for all April orders of HRC, CRC, and coated, flat rolled products by a minimum of $50/ton.

– Cliffs noted a stronger inflow of new orders was the main reason for the price increase.



Confidence among U.S. consumers slipped once again, but remains high, even as prices for just about everything continued to rise.

– The Conference Board reported that its consumer confidence index slipped to 110.5 in February from 111.1 previously.
– The present situation index, which measures consumers’ assessment of current business and labor conditions, rose slightly this month to 145.1 from 144.5 in January.
– The expectations index, based on consumers’ six-month outlook for income, business and labor market conditions, slipped to 87.5 in February from 88.8 in January.
– Concerns about inflation rose in February after declining the previous two months and the proportion of people planning to buy homes, cars, and major appliances during the next six months all fell.


This material, information and analyses (the “Content”) may include certain statements, estimates and projections prepared with respect to, among other things, historical data and anticipated performance.  Content may reflect various assumptions by Majestic Steel USA, Inc. concerning anticipated results that are inherently subject to significant economic, competitive and other uncertainties and contingencies and have been included for illustrative purposes.  Content is provided AS-IS.