US domestic HDG prices firm following announced increases

While many were skeptical when US flats mills announced a $2.00 cwt. ($44/mt or $40/nt) price increase two weeks ago, domestic coated flats steel spot prices have firmed in the last week. Both domestic hot dipped galvanized (HDG) and Galvalume base spot prices are up $1.00 cwt. ($22/mt or $20/nt) on the high end to $34.00-$36.00 cwt. ($750-$794/mt or $680-$720/nt) ex-Midwest mill.  For the time being, larger buyers are still able to make purchases at previous prices, especially as a few mills have unofficially backed off the increase following the larger than expected decline in scrap prices this month.

However, sources tell SteelOrbis a second price increase to solidify the first could come by the end of the month, especially if early speculation continues to point to a slight uptick in domestic scrap prices in August. For the time being, as many are still skeptical over the effectiveness of early July's increase, there has been no rush to make hedge buys in case prices do continue trend up; while some buyers locked in a few orders at attractive prices in the last couple weeks, many are sitting in a holding pattern waiting for an indication of which direction prices will move next.