Sources within the
US domestic hot dipped
galvanized and Galvalume coil markets say they believe that
US domestic
flats mills will soon roll out another price increase announcement, after domestic scrap prices settled up approximately $20.32-$25.40/mt ($20-$25/gt) in most regions of the
US this month. Trader sources say they’re keeping close watch on both domestic and offshore happenings, especially since the final determinations in the HDG trade case are set to be released early next-week.
US import tonnages of corrosion-resistant steel products are down markedly year-on-year. According to data from the
US Department of Commerce, Enforcement and Compliance,
US import tons of HDG coil totaled 261,003 mt (census data) in Dec. 2014, while
US import tons of HDG coil totaled 180,175 mt (license data) in Dec. 2015. Chinese import tons, which were tallied at 122,705 mt (census data) in May 2015, one month before
US steel producers filed petitions against offshore producers in
China,
India, South Korea, Taiwan and Italy, fell to 399.9 mt (license data) in Dec. 2015. Considering that the preliminary determinations called for preliminary subsidy rates between 26.26 percent and 235.66 percent for Chinese HDG coil, unless the final determinations change substantially, Chinese producers will in effect, be forced out of the market. Indian HDG producers have also seen a stark drop off shipments to the
US since the trade case was filed; in May 2015, Indian import tonnages were tallied at 23,223 mt (census data), while Dec. import tonnages were recorded at 174.1 mt (license data.)
In terms of current import offers, sources close to SteelOrbis have said that Indian HDG producers are keeping a close watch on
US domestic price trends, and they are prepared to re-enter the market aggressively once the final determinations in the trade case are announced. Brazilian futures prices for 0.019x41.5625 Gr80/AZ55 Galvalume coil, however, continue to be reported at approximately $3.00 cwt. ($66/mt or $60/nt) below
US domestic offer prices, which continue to hold in the approximate range of $34.50-$35.50 ($761-$783/mt or $690-$710/nt), ex-Midwest mill. It is unclear whether Brazilian steel producers will revise their offer prices should the
US domestic spot market begin to firm.