US flat rolled mills' November/December price hikes have not been officially rescinded, but for all intents and purposes, these price increases have fallen by the wayside as demand has slowed and imports have become more competitive.
For
coated products, US mills, on the whole, are reportedly booked through November, though they have not started booking December yet. Meanwhile, demand for hot rolled coils (
HRC) continues to lag behind that for hot dipped
galvanized (HDG) coils, with domestic
HRC lead times only extending to early November and
HRC prices softening slightly this month. And with
HRC remaining so weak, there is a chance that HDG might come down along with it.
US HDG prices have remained stable for the past several weeks and do not reflect the increases mills initially asked for when they announced November/December price hikes in early September. At this point, it can be said that these hikes were unsuccessful, as mills have adjusted their expectations in line with the lackluster demand and softening import prices.
Currently, US HDG base prices remain at a range of $33.00 cwt. to $35.00 cwt. ($728/mt to $772/mt or $660/nt to $700/nt). Domestic spot offers for 0.019” x 48” G90 (0.48 mm x 1.219 m) remain at a range of $44.00 cwt. to $46.00 cwt. ($970/mt to $1,014/mt or $880/nt to $920/nt) ex-Midwest mills. Offers for 0.012” x 40.875” G30 (0.30 mm x 1.04 m) still range from approximately $48.00 cwt. to $50.00 cwt. ($1,058/mt to $1,102/mt or $960/nt to $1,000/nt) ex-mill, Midwest. Domestic offers of Galvalume 0.019” x 41.5625” Gr.80/AZ55– aluminum and zinc alloy-
coated sheet –range from $45.00 cwt. to $47.00 cwt. ($992/mt to $1,036/mt or $900/nt to $940/nt) ex-mill, Midwest.
Nevertheless, even with overall US flat rolled demand being so quiet, no significant softening is expected for domestic prices over the coming months because inventories are still tight, mills are still late on deliveries and imports are still largely out of the picture. Furthermore, little if any hedge buying is taking place, so the market will likely be poised to start rising again as soon as demand starts to recover. However, the market will likely have to wait at least several months, possibly until next spring, for such a recovery. In the meantime, the US HDG market is likely in for some slight price softening through the holiday season, especially if import offers become more aggressive.
Import HDG offers for the US have not declined further since last week, but the trend is clearly down.
China's offers dropped in several large steps in September through the first week of October, and were quickly met by a correction in Indian prices as well. Offshore lead times have also shortened in the last month. Still, while a downward trend persists for import HDG offers, the pace of the decline has been somewhat moderate and there is not a lot of interest in buying offshore right now. However, if import offers continue to diverge from domestic, US mills will probably have to come down with their prices.
This week,
China and
Taiwan are not active in the market because of the week-long National Holiday observance, though they are expected to be back with revised offers as soon as next week.
China remains the market leader for import HDG with the most competitive offers, and their new revised offers are expected to reflect at least a modest decrease from current levels. In the meantime,
China's and
India's previous offers have not been revised since last week and are still valid.
Taiwan and
Korea do not currently have active offers in the market.
For now, Chinese offers of 0.019” G90 still range from approximately $40.00 cwt. to $42.00 cwt. ($882/mt to $926/mt or $800/nt to $840/nt) duty-paid, FOB loaded truck in US Gulf ports, while Chinese offers of 0.012” G30 mostly range from approximately $40.00 cwt. to $41.00 cwt. ($882/mt to $904/mt or $800/nt to $820/nt) FOB loaded truck in US Gulf ports.
Indian 0.019” G90 offers continue to range from $41.50 cwt. to $42.50 cwt. ($915/mt to $937/mt or $830/nt to $850/tn) duty-paid, FOB loaded truck in US Gulf ports, and most 0.012” G30 offers range from $42.50 cwt. to $43.50 cwt. ($937/mt to $959/mt or $850/nt to $870/nt) duty-paid, FOB loaded truck in US Gulf ports.
On the Galvalume end, there are still import offerings for the US of 0.019” AZ55 from
India and
China. Both sources are offering at an approximate range of $44.00 cwt. to $45.00 cwt. ($970/mt to $992/mt or $880/nt to $900/nt) duty-paid, FOB loaded truck in US Gulf ports.