Both domestic and import HDG (hot dip galvanized) coil prices in the US market have declined further since last week as the nation's demand for flat rolled products has yet to improve.
US mill HDG base prices dropped by another $1.00 cwt. ($22 /mt or $20 /nt) since last week, to a range of $23.00 cwt. to $25.00 cwt. ($507 /mt to $551 /mt or $460 /nt to $500 /nt). Domestic offers for the most commonly produced HDG item in the US, 0.019” by 48” G90 (0.48 mm x 1.219 m), have dropped by the same amount, with most offers now ranging from $32.00 cwt to $34.00 cwt. ($705 /mt to $750 /mt or $640 /nt to $680 /nt) ex-mill. Domestic offers of the lighter gauge item 0.012” by 40.875” G30 (0.30 mm x 1.04 m) have also fallen by $1.00 cwt. since last week with most offers now ranging from $34.00 cwt. to $36.00 cwt. ($750 /mt to $794 /mt or $680 /nt to $720 /nt) ex-mill.
Domestic flat rolled mills have become increasingly competitive as mills struggle to get business amid the continued weak demand. Minimills have led the way with price decreases, although integrated mills have also lowered their prices to that of the minimills in order to stay competitive, though they are at a cost disadvantage. And while domestic mills, with their aggressive pricing and shorter lead times, have been able to lure most US flat rolled business away from imports, overall demand remains weak.
US mills say that for current production, business is decent, and that May is expected to be better than April. However, US mills are still struggling to fill their order books, which is evidenced in their continued price drops, discounts for large orders, and quick deliveries. US scrap prices are expected to show some slight improvement in May, and it is rumored that Nucor and company will to try to raise their prices accordingly. However, unless flat rolled demand starts to improve, there is not a strong chance that customers will accept any price increases.
Import HDG offers for the US have also come down since last week, although there is very little interest in foreign offers at present and very few new bookings are taking place. Also, traders comment that while import prices are still edging downwards to keep pace with the US mill price cuts, foreign flat rolled mills, particularly those in Asia, are becoming increasingly reluctant to lower their offers for the US.
While they are not booking any US orders, sentiment among Asian flat rolled producers is up, as slab prices in the region have increased. Also, given the uncertain market conditions and quick and easy availability offered by domestic mills, most flat rolled buyers in the US would rather buy small tonnages of domestic material on an as-needed basis to avoid the longer lead times for offshore material, regardless of price. Rumors of an antidumping case that may soon be filed against HDG imports from China and others are also making traders wary of bringing in tons from certain import sources.
On the 0.019” G90 side, most offshore offers for the US have declined since last week, while most 0.012” G30 offers, which are not produced as abundantly in the US, have remained unchanged. South Korean offers of both items generally remain the most competitive compared to other import offers. Indian 0.019” G90 offers are down by about $3.00 cwt. ($66 /mt or $60 /nt) since last week, and now range from $31.00 cwt. to $33.00 cwt. duty-paid, FOB loaded truck in US Gulf Coast ports. South Korean offers for the same product fell by $4.00 cwt. ($88 /mt or $80 /nt) since last week with most offers now ranging from $31.00 cwt. to $33.00 cwt. ($683 /mt to $728 /mt or $620 /nt to $660 /nt) duty-paid, FOB loaded truck in US West Coast ports.
Chinese and Taiwanese offers of 0.019” G90 both dropped by $2.00 cwt. ($44 /mt or $40 /nt) since last week with Chinese offers now ranging from $32.00 cwt. to $34.00 cwt. duty-paid, FOB loaded truck in US Gulf ports, and Taiwanese offers ranging from $33.00 cwt. to $35.00 cwt. ($728 /mt to $772 /mt or $660 /nt to $700 /nt) duty-paid, FOB loaded truck in US West Coast ports.
As for 0.012” G30 imports, offers from India, China, Mexico and Korea have all remained stable since last week, while Taiwanese offers have come down by $1.00 cwt. since last week. Indian offers continue to range from $33.00 cwt. to $35.00 cwt. in Gulf ports, while Chinese offers remain in the range of $34.00 cwt. to $36.00 cwt. in the Gulf. Mexican and Korean offers found at $33.00 cwt. to $35.00 cwt. (Mexican offers are delivered at the border crossing while Korean offers are loaded truck in the West Coast). Taiwanese offers now range from $34.00 cwt. to $36.00 cwt. on the West Coast.
Import offers of galvalume items (0.019" x 41.5625" Gr80/AZ55) from Mexico and Taiwan have decreased by $1.00 cwt. to $2.00 cwt. since last week, with most Mexican offers now ranging from $33.00 cwt. to $35.00 cwt. delivered at the border crossing and Taiwanese offers ranging from $34.00 cwt. to $36.00 cwt. duty-paid, FOB loaded truck on the West Coast. These prices compare to current the domestic price range for 0.019” AZ55 of $33.00 cwt. to $35.00 cwt. ex-works.