US domestic HDG prices show signs of stability

After months of softening, US domestic coated flat steel spot prices have remained steady over the past couple weeks. The timing of Severstal North America's price increase a week ago was a surprise to most considering a short holiday week and therefore a slowdown in activity; but by last Friday, most other US domestic mills had formally informed customers of a $2.00 cwt. ($44/mt or $40/nt) increase on new orders. However, as a result of the holiday and another $30-$60/lt drop in domestic scrap prices in July, US buyers haven't felt the urgency to place orders just yet. Sources told SteelOrbis that most are waiting for "the dust to settle" following the scrap decline before determining whether the spot market has bottomed.

Nonetheless, US buyers' confidence in booking imports has improved over the last couple weeks as the approximately $2.00 cwt. ($44/mt or $40/nt) lower offer prices from India and Mexico have been enough for more buyers to at least consider placing an offshore order. For the second consecutive week, US domestic hot dipped galvanized (HDG) and Galvalume spot prices have been mostly stable, with base prices still between $34.00-$35.00 cwt. ($750-$772/mt or $680-$700/nt) ex-Midwest mill. Still, higher volume orders are garnering discounts as lead times remain short and mill production rates and availability remain above current demand levels.