fMost import hot dip galvanized (HDG) sales prices in the US have remained stable since last week, although new offers from southeast Asian mills indicate a continued downward price trend. Meanwhile, China may be back on the scene soon with competitive offers following the VAT export rebate increase for galvanized products.
Import HDG sales prices offered by traders to US customers have generally trended sideways over the past week, while foreign mills' HDG offers for traders continue to decrease, indicating that sales prices will soon decrease in turn. However, very few orders are being booked. Most offshore mills continue to offer on a "bid" basis, waiting for traders to approach them with a firm order before quoting prices. While offshore numbers are getting more competitive, especially from South Korea, there is simply not enough business out there to be had, and domestic mills are picking up most of it.
In other import HDG news, Chinese offers, which have remained at uncompetitive price levels since January, are expected to decrease imminently following the Chinese government's implementation of the increased VAT rebate for these exports as of April 1. With the export rebate for HDG rising from five to 13 percent, Chinese offers may, once again, become the most competitive import source for HDG.
At the same time, there are are rumors floating around that US producers will imminently file an antidumping case against Chinese HDG, though the rumors have yet to be substantiated. However, it is not a sure thing, if a case were to be filed, that the US mills would be successful in proving injury. The flow of Chinese HDG imports to the US has slowed to a trickle in recent months after spiking in the second half of 2008. Chinese HDG imports reached their highest point in October, at 68,200 mt, after which they declined to levels under 30,000 mt per month in November and December, and under 20,000 mt per month for the first three months of 2009. But despite the slowdown in the first few months of the year, Chinese HDG imports may ramp up again now that the the export rebate has risen.
Meanwhile, import sales prices for South Korean and Taiwanese offers of 0.019" x 48" G90 (0.48 mm x 1.219 m) are still ranging $35.00 cwt. to $37.00 cwt. duty-paid, FOB loaded truck in US West Coast ports. Indian offers of 0.019" G90 are still offered at a range of $34.00 cwt. to $36.00 cwt. duty-paid FOB loaded truck in US Gulf ports.
For import offers of 0.012" x 40.875" G30 (0.30 mm x 1.04 m), Indian and Taiwanese offers have also remained at the same levels as last week, with Indian offers ranging from $35.00 cwt. to $37.00 cwt. duty-paid, FOB loaded truck in US Gulf ports and Taiwanese offers ranging from $36.00 cwt. to $38.00 cwt. ($794 /mt to $838 /mt or $720 /nt to $760 /nt) duty-paid, FOB loaded truck in US West Coast ports. Meanwhile, Mexican offers have also trended sideways since last week, with most offers ranging from $35.00 cwt. to $37.00 cwt. at the border crossing.
Import galvalume (0.019" x 41.5625" Gr80/AZ55) offers from Taiwan, Mexico, and India are still all generally offered at a range of $36.00 cwt. to $38.00 cwt. (Mexican offers are at the border crossing and the Indian offers are duty-paid, FOB loaded truck in US Gulf ports. The Taiwanese offers are duty-paid, FOB loaded truck in US West Coast ports). South Korean galvalume offers are the most aggressive, and have weakened by about $1.00 cwt. ($22 /mt or $20 /nt) since last week with most offers now ranging from $35.00 cwt. to $37.00 cwt. duty-paid, FOB loaded truck in US West Coast ports.
For now, domestic HDG offers continue to be the most competitive option for US buyers due to their short lead times and aggressive price-matching. Since last week, domestic prices have remained steady with base prices remaining at a range of $26.00 cwt. to $28.00 cwt. ($573 /mt to $617 /mt or $520 /nt to $560 /nt) ex-Midwest mills. However, big customers may be able to get slightly under this level. Domestic offers of 0.019" x 48" G90 (0.48 mm x 1.219 m) range from $35.00 cwt. to $37.00 cwt. ex-mill, while 0.012" x 40.875" G30 (0.30 mm x 1.04 m) offers are also steady from last week, with most offers still ranging from $36.00 cwt. to $38.00 cwt. ex-mill.
Domestic galvalume base prices and 0.019" x 41.5625" Gr80/AZ55 are also at the same levels as last week, with base prices at $27.00 cwt. to $29.00 cwt. ($595 /mt to $639 /mt or $540 /nt to $580 /nt) ex-mill and AZ55 offered at $36.00 cwt. to $38.00 cwt. ex-mill.
The domestic pricing trend for HDG also continues to be down. While no one is "officially" lowering prices, it is no secret that US mills are seeing very little business and have had to become increasingly competitive with imports in order to get any business. Generally, HDG demand continues to be, in a word, "awful," in the words of one trader. But on the bright side, demand does not seem to be deteriorating rapidly from week to week; instead, flat rolled demand, while remaining weak, seems to be leveling off.