Although no official price announcements have been made by US Midwest flat rolled mills, as of late hot dip galvanized (HDG) prices are heading slightly down.
In recent weeks, HDG demand has been slipping, as the automotive and residential construction markets have continued to be lackluster. Mills are having trouble filling their HDG order books and some are still selling at their July pricing levels (though August pricing has been announced from most mills). HDG is definitely the weakest of the flat rolled products; however, it is by no means close to caving just yet. Business is still decent and people are still buying, just at slightly lower numbers as things are beginning to quiet down perhaps due to the usual summer slowdown. Mills are willing to make deals and although no official price announcement has been made, they are often willing to book orders at prices lower than their list numbers. Numbers at the higher end of the large price spread have disappeared, and mills have been lowering their prices by about $40 /nt to $50 /nt ($2.00 cwt. to $2.50 cwt. or $44 /mt to $55 /mt) from the published price in order to get business.
Domestic HDG 0.019" x 48" G90 spot prices range from $69.00 cwt. to $71.00 cwt. ($1,521 /mt to $1,565 /mt or $1,380 /nt to $1,420 /nt) ex-mill Midwest. Prices on the West Coast are approximately $3.00 cwt. ($66 /mt or $60 nt) greater.
Another interesting development that has been seen for both HDG and cold rolled coils (CRC) is the widening gap between contract and spot prices. Now contract prices for both HDG and CRC are well below spot prices, and some customers that buy on a contract basis are reselling the material for more than what they paid by contract, but less than what the going spot price is. This less-expensive material is finding its way into the market and may push domestic mills to lower their spot numbers if they want the business.
On the import side, offers are still out there, although the numbers are not too attractive. When domestic prices were on their upward swing during the past couple of months, import offers were pricing out competitively. However, now import offers are higher than the domestic numbers and are still trending upward.
Taiwan is offering HDG 0.019" x 48" G90 to the US at slightly higher numbers than their last offering, but the mills aren't too interested in selling the material, and US customers aren't interested in buying it either. Taiwanese offers currently range from $72.00 cwt. to $74.00 cwt. ($1,587 /mt to $1,631 /mt or $1,440 /nt to $1,480 /nt) FOB loaded truck Gulf Coast ports. Prices are approximately $1.00 cwt. ($22 /mt or $20 /nt) lower delivered to the West Coast.
Chinese offerings for the same size and coating are also said to be up, and mills are trying for more increases, though there are not many takers.
Offers from India for 0.012" by 40.875" G30 have remained at the same levels as reported by SteelOrbis two weeks ago. There are not many takers for these offers which range from $72.00 cwt. to $74.00 cwt. ($1,587 /mt to $1,631 /mt or $1,440 /nt to $1,480 /nt) FOB loaded truck Gulf ports for October deliveries. Although the Indian government has removed the five percent export tax on galvanized products, offers are still trending strongly up and another increase is expected.
On the galvalume side of the market, demand is much stronger than that for HDG products. Lead times are long and the mills' lines are full. For 0.019" by 48" AZ55 items, domestics are ranging from $72.00 cwt. to $74.00 cwt. ($1,587 /mt to $1,631 /mt or $1,440 /nt to $1,480 /nt) FOB mill. As for imports, Taiwan has come out with new offers since our last report, at approximately $2.00 cwt. ($44 /mt or $40 nt) higher than their last range. Taiwanese offers are in the range of $72.00 cwt. to $74.00 cwt. ($1,587 /mt to $1,631 /mt or $1,440 /nt to $1,480 /nt) FOB loaded truck Gulf and West Coast. Indian offers are comparable to the Taiwanese offerings. Other countries, such as South Korea and Brazil, are said to be selling to the US right in the middle of this range.