Cautious buying persists as US HDG prices inch higher

Even as US domestic hot dipped galvanized (HDG) prices are increasing, purchasing activity remains measured and lead times are stagnant. Lead times of four to six weeks on coated products have not moved since mills' $4.00 cwt. ($88/mt or $80/nt) in announced increases in July as the rate at which buyers are placing orders has not changed. Sources tell SteelOrbis that most buyers are still only filling inventory holes or making purchases on an as-needed basis, as they remain unconvinced that the current uptrend has lasting power. The HDG and Galvalume market remains oversupplied and even with the shutdown of RG Steel, mill utilization rates have increased.

For now, mills are pushing for higher prices but how much of an increase they are getting varies greatly between mills and customers. Currently, HDG base prices are in the range of $37.00-$39.00 cwt. ($816-$860/mt or $740-$780/nt) ex-Midwest mill, although most transactions are now taking place on the higher end of the range. Meanwhile, HDG 0.012"x40.875" G30 and HDG 0.019"x48" G90 spot prices are $47.00-$48.00 cwt. ($1,036-$1,058/mt or $940-$960/nt) ex-Midwest mill, well above some current import offer prices. As result, there has been some renewed import activity as a majority of import offer prices are on a downtrend while US prices are moving higher.