US import HDG prices stabilize temporarily

Import offer prices hot dipped galvanized (HDG) and Galvalume in the US have stayed neutral since last week following persistent declines in the last month. Trader sources explained that many of the offshore mills are awaiting the US domestic market's next move and have therefore not made any pricing changes. Chinese and Taiwanese mills have rolled over prices for December delivery into January while Indian offer prices are also stable although delivery dates are still in December. However, even if US domestic spot prices increase again in September, import offer prices are unlikely to rise considering the extremely weak local markets in the Far East and India. But, if US prices reverse course and begin trending down, import prices are likely to follow.

Over the last couple weeks, import activity has been steady, but now that lead times are in January 2013 from China and Taiwan, some US buyers have been more inclined to place an offshore order as the disparity between US spot prices and some futures prices are as much as $7.00 cwt. ($154/mt or $140/nt)). Chinese HDG 0.012"x40.875" G30 offers are $40.00-$41.00 cwt. ($882-$904/mt or $800-$820/nt) DDP loaded truck in US Gulf ports compared to $47.00-$48.00 cwt. ($1,036-$1,058/mt or $940-$960/nt) ex-Midwest mill on the US spot market. The spread between US and import prices on other products such as Galvalume 0.019x41.5625 Gr80/AZ55 is only about $3.00-$4.00 cwt. ($66-$88/mt or $60-$80/nt), but is still enough to generate some activity.

**DDP loaded truck delivered into Houston