Correction: Due to a system error, the March 3rd Tubing report was repeated in the March 20th Daily Extract by mistake. The correct report is as below:
The US domestic tubing market has seen a number of hefty increases so far this year, and buyers say the increases are not over as another rise is expected within the next couple weeks. It's also believed there are more increases coming before this summer.
The majority of North America's tubing mills are more or less offering the same prices for hollow structural sections, now that March prices have been announced. In mid-February, Independence Tube made the first March price announcement upping prices by $40 /nt ($2.00 cwt. or $44 /mt). Shortly after, the other major domestic tubing mills came out with March prices which were $80 /nt ($4.00 cwt. or $88 /mt) higher than those for February. Independence Tube later amended its prices to reflect the $80 /nt ($4.00 cwt. or $88 /mt) increase that its competitors initiated.
The $4.00 cwt. ($88 /mt or $80 /nt) March price increase followed $7.00 cwt. ($154 /mt or $140 /nt) in increases for January and $3.00 cwt. ($66 /mt or $60 /nt) for February. In total, so far for 2008, domestic hollow section prices have risen by $14.00 cwt. ($309 /mt or $280 /nt) and there are more to come. According to buyers, tubing mills have another increase up their sleeves. Insiders suggests that US tubing mills will be upping prices by another $80 /nt ($4.00 cwt. or $88 /mt) towards the end of this month for April orders. There has yet to be talks for the following months; however, at the rate flat rolled products are going up, it is most likely this upward pricing trend will continue.
Current domestic prices for hollow structural sections range from $52.00 cwt. to $53.00 cwt. ($1,146 /mt to $1,168 /mt or $1,040 /nt to $1,060 /nt) for A500 grade A and grade B hollow sections up to 6" in the Midwest regions.
The distressed square and rectangular tubing from China that did not meet the US specifications is still available for resale in the US and is priced at approximately $25.00 cwt. to $26.00 cwt. ($551 /mt to $573 /mt or $500 /nt to $520 /nt) loaded truck. Along with domestic-made tubing, these prices have also gone up significantly in the last month. Buyers that are able to use this lower quality tubing are more willing to buy, especially as domestic numbers climb.
Globally, for all steel products, prices are going up rapidly. International levels are now higher than their domestic counterparts and very little is being offered to US customers by traders. There are scattered offers from Asian markets to the US West Coast and from Turkey to the Gulf; however, there are very little takers as the offering prices are very high.
Turkish offers to the Gulf have risen significantly since our last report three weeks ago and are now ranging from $54.00 cwt. to $55.00 cwt. ($1,191 /mt to $1,213 /mt or $1,080 /nt to $1,100 /nt) FOB Gulf ports. Mexican offers are even higher than that due to the rapidly rising flat rolled prices in Mexico, perhaps because of the absence of flat rolled deals from the US. Mexico's steel consumption is very decent with their economy growing at a good pace.
Data from the US Import Administration show that for structural pipe and tube worldwide exports to the US have been on a decline since the beginning of 2008. January saw 37,242 mt imported in the US, while February saw 35,468 mt, and data through March 18 show 20,009 mt. So far for March 2008, the top three exporters to the US are Canada with 9,252 mt, Japan with 4,059 mt, and Mexico with 3,416 mt.