US domestic HDG market takes a breather from price movement

While some whistle an optimistic tune about prices no longer being on a downslide, others still point out that demand has not really improved, stating that while it's believed that the "bleeding has stopped" that the sideways pricing move may only prove to be temporary and could be susceptible to another dip, at least until demand and production capacity find themselves more on par with each other.  As of end of business on Monday, August 16, there was no indication by any mill that further production curbing, to match demand, was taking place.   

The general consensus, though, is that spot pricing had been taken "far lower" than it should have been, and that since this did not succeed in making more orders magically appear, that it's only logical that increases would be announced.   But again, the only real player in the HDG pool right now seems to be the automotive sector, and as previously mentioned, it takes more than order activity in one market segment to carry a product line.  

Yes, the manufacturing sector is continuing to indicate month-on-month improvements-  but those improvements, while certainly positive, are not yet enough to make a marked impact to the bottom lines of those selling coated products.

Demand for Galvalume products, not surprisingly, has remained the weakest of its coated counterparts.  The reason for this is simple- construction (or lack thereof).  While the Associated General Contractors of America reported earlier this month that that total construction spending for the month of June had eeked out a small rise, that "pain is continuing for most contractors and their workers".  And unfortunately, if buildings aren't being erected, roofing, siding, air conditioning units, and appliances are not flying off the shelves.

For now, however, the forecast for US domestic HDG will remain at neutral to slightly up, until order activity and production levels sort themselves out to a level plane.

Looking offshore, China has remained neutral with their pricing since our last report, while Taiwan and Mexico have once again reemerged on the Galvalume front, with offer pricing closely resembling those of domestic mills.  However, when taking into account continued uncertainty within the US market, imports of any kind are not much being considered.