As both flat rolled orders from the automotive sector and US busheling scrap prices registered larger than expected increases this month, US flat rolled mills have announced additional price hikes for January/February shipments.
Since last week, both Nucor and AK Steel have announced an additional $30/nt ($33/mt $1.50 cwt.) spot price hike for coated products shipped in January, which, combined with these firms' initial January price hikes announced late last month, push base prices for hot dipped galvanized (HDG) coils up by a total of $60/nt ($66/mt or $3.00 cwt.) for January (and matching Severstal North America's two-tiered $60/nt total price hike for January/February). Including new higher extras announced for January, the total price increase by domestic producers for January shipments of HDG products is approximately $80/nt ($88/mt or $4.00 cwt.) or higher, depending on product.
The outlook for the coated product segment of the US flat rolled market is particularly bullish right now, with lead times from most HDG suppliers pushed out to early February. Coated products are currently benefiting from the up-tick in automotive/contract business, which has pushed up spot pricing in lock-step.
Restocking activity from service centers is also expected to continue in the near-term, while very few imports are coming. Furthermore, with scrap prices still trending slightly up, there is a good chance that there are still further scrap price increases to come for the US flat rolled market.
Spot prices for January/February have not fully reflected the domestic price hikes across the board, though prices are trending up, with the lower end of the offered range moving up by about $1.00 cwt. ($22/mt or $20/nt) since last week and more increases expected. Current base prices for HDG from domestic mills in the Midwest are at approximately $32.00 cwt. to $33.00 cwt. ($705/mt to $728/mt or $640/nt to $660/nt), while offers of the most common size and coating, 0.019" x 48" G90 (0.48 mm x 1.219 m) now range from $43.00 cwt. to $44.00 cwt. ($948/mt to $970/mt or $860/nt to $880/nt) ex-mill (Midwest). These ranges are both expected to climb higher in the next couple weeks.
Import prices have also moved up within the past couple weeks following the string of domestic price hikes, though there are very few bookings taking place as offers are not competitive. Offshore flats mills are generally not chasing any volume US bookings currently and are only active for small-volume, niche items. Offers of 0.019" G90 from India and Taiwan currently range from approximately $42.50 cwt. to $44.00 cwt. ($937/mt to $970/mt or $850/nt to $880/nt) duty-paid, FOB loaded truck in US Gulf ports, while Taiwanese offers are about $1.00 cwt. higher.
For the light gauge HDG item, 0.012" x 40.875" G30 (0.30 mm x 1.04 m), Mexico is mostly out of the market though there are still some scattered offers heard at $42.00 cwt. to $44.00 cwt. ($926/mt to $970/mt or $840/nt to $880/nt) delivered to the border crossing. Indian offers of 0.012" G30 range from $42.50 cwt. to $44.00 cwt. duty-paid, FOB loaded truck in US Gulf ports, while Chinese offers range from $43.50 cwt. to $45.00 cwt. ($959/mt to $992/mt or $870/nt to $900/nt) and Taiwanese offers range from $45.50 cwt. to $47.00 cwt. ($1,003/mt to $1,036/mt or $910/nt to $940/nt) -- both duty-paid, FOB loaded truck in US Gulf ports.