Spot prices and lead times in the US coated sheet market continue to go up, driven by raw materials and contract business.
While buyers remain cautious about building inventory while demand remains slow, the momentum in the US flat rolled market has continued in recent weeks, aided by expectations of a domestic busheling scrap price hike of at least $40/long ton this month. US producers have yet to announce any further base price hikes since before the holidays, but new extras from Nucor and others (as zinc prices are also on the rise) have continued to drive offers upwards.
For coated products in particular, contract business from automotive and service centers has pushed up lead times and pricing in recent weeks, though the volume of spot bookings at the new transaction levels remains light. It remains the case that the market is driven more by cost and supply factors rather than demand, and buyers are well aware that if scrap turns around again that the market could start trending down again. For now, the price trend for hot dipped galvanized (HDG) coils remains up, with further price increases from domestic producers expected to be announced as soon as the January scrap price hike is realized.
Domestic base prices for galvanized now range from $33.50 cwt. to $34.50 cwt. ($739/mt to $761/mt or $670/nt to $690/nt) ex-mill in the Midwest, while most offers with a 0.019" x 48" G90 (0.48 mm x 1.219 m)size and coating fall into a range of $45.00 cwt. to $46.00 cwt. ($992/mt to $1,014/mt or $900/nt to $920/nt) Base prices for Galvalume coils are about $1.00 cwt. ($22/mt or $20/nt) higher than those for HDG. Most mills' lead times are currently into mid-February.
On the import side, the coated market remains very quiet with very few workable offers. Mexico is reportedly completely out of the market while customers are waiting on new prices from India and China.
Preliminary census data for November show that HDG sheet and strip imports by the US totaled 63,276 mt during the month, down from 82,795 mt in October and down from 109,878 mt imported in the year-ago month. The US' largest import source of HDG sheet and strip in November was Canada (35,319 mt); followed distantly by Korea (6,186 mt), Taiwan (5,314 mt), Mexico (5,066 mt), and China (3,779 mt).