As US domestic flat rolled prices rapidly weaken, it won't be long before US domestic hollow structural sections (HSS) prices fall as well. Despite two announced increases (one in July and one in early August) totaling $4.00 cwt. ($88/mt or $80/nt), tubing mills were only able to collect on the first increase, and even then, not from all customers. Many larger buyers paid little, if any, of the announced increases. And for the most part, buyers were waiting to see if the increases had holding power before placing any significant orders. Expectedly, though, US domestic flats prices are falling at a rapid pace, which isn't expected to take long to spill over into the tubing market. Demand and activity are steadily only decent for HSS, and without the support of increasing raw material costs, mills aren't likely to be able to hold onto the current spot range of $46.50-$47.50 cwt. ($1,025-$1,047/mt or $930-$950/nt) ex-Midwest mill for too much longer.
Already, there are plenty of deals for large projects heard below the range and prices are likely to soften in the next couple weeks. A few import offers are also available from various sources such as Korea and Italy, which currently range around $38.50 cwt. ($849/mt or $770/nt) DDP loaded truck in US Gulf ports, but Korean prices are weakening as well and some offers have been heard even lower. Mexican prices, meanwhile, are still about $38.00-$39.00 cwt. ($838-$860/mt or $760-$780/nt) DDP loaded truck delivered into Houston, unchanged in the last couple weeks, but sources tell SteelOrbis that unless they are situated near a port, most US buyers are likely to stick with domestic material until US prices shows signs of stability.