Following the string of price hikes announced by US flat rolled producers over the past couple weeks, the US hot dip
galvanized (HDG) market is still finding its footing, and it is not yet clear exactly where prices will ultimately settle at. Furthermore, rumor has it that mills could announce another price hike as soon as next week.
US flat rolled mills announced widespread price hikes last week, most of which indicated that transaction prices would rise by $30/nt ($1.50 cwt. or $33 /mt) for July shipments. The new base prices for HDG quoted by US mills range from about $24.00 cwt. to $24.50 cwt. ($529 /mt to $540 /mt or $480 /nt to $490 /nt). However, mills have different extra policies, with some charging half of their extras in addition to the new base pricing for July and some now insisting on the full extras plus the base price increase.
Furthermore some mills are now charging big premiums for light gauge grades with net price hikes that far exceed the announced $30/nt increase. But again, it is not clear whether the mills will be able to achieve the full amount they are asking for.
There has been a definite up-tick in buyer interest since the price hikes were announced; however, most customers are aiming to book at the old prices, not the new prices, and is still not certain whether some mills will accept any July orders at the June prices. Ultimately, since demand is still relatively weak, mills will probably not turn down an attractive order as long as they get some kind of increase.
US HDG base prices on the spot market last week ranged from $22.00 cwt. to $24.00 cwt. ($485 /mt to $529 /mt or $440 /nt to $480 /nt), while both 0.019” x 48” G90 (0.48 mm x 1.219 m) and 0.012” x 40.875” G30 (0.30 mm x 1.04 m) offers ranged from $30.00 cwt. to $32.00 cwt. ($661 /mt to $705 /mt or $600 /nt to $640 /nt) ex-Midwest mills. By next week, it should be more apparent where the new prices will settle at.
Then again, SteelOrbis hears that there is a good chance that US flat rolled mills will announce an August price hike soon – possibly as soon as next week -- in order to ensure that the July price increase sticks. Although everyone seems to agree that prices aren't dropping anymore, we may not see prices rise across the board until mills start booking for August shipments. Mills could start booking for August pretty soon though if they are able to fill up their July order books quickly.
Despite the weak end-use demand, US flat rolled supplies are tight, and also working in the US mills' favor is that import offers are becoming increasingly less competitive. A few Asian sources are still offering, but their prices are far higher than their domestic counterparts and are still on the rise as the Asian markets continue to heat up.
On the 0.019” G90 side, offers for the US from Chinese mills have risen to a level of $36.00 cwt. to $38.00 cwt. ($794 /mt to $838 /mt or $720 /nt to $760 /nt), duty-paid, loaded truck, in US Gulf Coast ports while South Korean offers range from $37.00 cwt. to $38.00 cwt ($816 /mt to $838 /mt or $740 /nt to $760 /nt) duty-paid, loaded truck, in US West Coast ports.
For 0.012” G30,
India is offering at a range of $35.00 cwt. to $37.00 cwt. ($772 /mt to $816 /mt or $700 /nt to $740 /nt) duty-paid, loaded truck, in US Gulf Coast ports, while
Korea is offering at $39.00 cwt. to $41.00 cwt. ($860 /mt to $904 /mt or $780 /nt to $820 /nt) duty-paid, loaded truck, in US Gulf Coast ports.
The latest Taiwanese price indications for both 0.012” G30 and 0.019” G90 are in line with Korean offers.