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Hot-rolled imports cool as cold-rolled heats up

Keywords: Tags  steel prices, hot-rolled sheet, cold-rolled coil, import market, steel traders, India steel, Port of Houston imports, Catherine Ngai

NEW YORK — While foreign hot-rolled coil continues to drag its feet in the U.S. market, interest in imported cold-rolled coil might reignite with new offers from India.

Since last year, traders and buyers have indicated that low domestic hot-rolled coil prices coupled with lackluster demand and an amended Russian suspension agreement have made selling hot-rolled coil extremely difficult stateside.

"No one is importing hot-rolled (coil) because of the same situations and too many anti-dumping cases," one trader said. "Apart from the Nafta (North American Free Trade Agreement) countries, there’s so little coming from elsewhere."

Sources this past week reported hot-rolled import deals into the Port of Houston at $580 to $600 per short ton ($29 to $30 per hundredweight) vs. domestic prices in the South closer to $630 to $640 per ton ($31.50 to $32 per cwt) and $640 per ton in the Midwest.

But, while hot-rolled coil has been slow to start, new offers of cold-rolled coil from India may peak interest.

"The new thing out there is Indian," a second trader said. "I think it’s more of a function that there’s a lot of cold-rolled capacity coming online there. Before, most of their cold-rolled were for galvanizing lines, but with excess material they’re willing to become more aggressive on cold-rolled deals. They also saw the opportunity with the Chinese recently raising prices and the (Indian) rupee taking a tumble."

Some 20,486 tonnes of Chinese cold-rolled coil were poised to hit U.S. shores through Sept. 25, indicating a seven-month high, license data from the U.S. Commerce Department’s Import Administration show. The material was booked over the summer at lower prices of $640 per ton, although others have confirmed Chinese tags have since increased.

"It looks to me that Chinese prices went up," one Northeast buyer said.

Indian cold-rolled coil isn’t a new item to the U.S. market, but it hasn’t been a steady one in quite some time. Year-to-date data, including license data through Sept. 25, shows some 1,138 tonnes of Indian cold-rolled coil hitting U.S. shores.

An average of 525.7 tonnes of Indian cold-rolled coil was imported per month in 2012, up from an average of 316.4 tonnes per month in 2011, according to monthly averages from the U.S. Census Bureau. In 2006, however, the U.S. market imported on average 5,877 tonnes of Indian cold-rolled coil per month.

Sources pegged cold-rolled coil import transactions at $670 to $700 per ton ($33.50 to $35 per cwt) into the Port of Houston this past week, with Indian product on the lower end while Chinese material was on the higher end. Domestic prices in the South were closer to $740 per ton ($37 per cwt) and $750 per ton ($37.50 per cwt) in the Midwest.

However, some buyers, still hesitant in an uncertain domestic market, indicated that making any plunge on imports would be difficult.

"The issue is that when you place it, that number could drop by the time it arrives. You’re hedging on prices going up, and I don’t think I see that for domestics right now," one East Coast service center source said.

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