How long can the US HDG market’s stable trend last?

Even after a second round of price increases, US domestic coated flat steel spot prices are still stagnant for the third consecutive week. Sources tell SteelOrbis that while there have been many industry players "talking the market up," customers are still pushing for price reductions, rather than paying any price increase. One Midwest service center buyer commented that while some mills have been trying to push for at least some sort of an increase, other mills have been so concerned with filling order books that raising prices is not their main priority. The lack of a united front from flats mills continues to be one reason many US buyers are sitting on the sidelines and waiting until the last minute to place orders.

Another concern is a high rate of US steel production, which increased 3.1 percent last week, bringing the average capacity utilization rate to over 79 percent. Additionally, US-buyer inventories are more than adequate, according to sources. Consequently, domestic hot dipped galvanized (HDG) and Galvalume spot prices, and prices for corresponding coating extras, continue to be static; and with little supporting recent increases--scrap prices came down again this month--spot prices are poised to remain neutral for at least another week.