Increased momentum in the U.S. steel sheet market after a
recent round of price increases has spilled over to the import
market, traders said, with increased interest in foreign
material and a decent price spread making deals possible.
"Our import activity
is the best weve seen in a while," one trader said. "This
is more on the cold-rolled and galvanized side. Clearly,
because of the nature of the beast, we arent seeing much
hot-rolled as this is a protected market segment. The price
increases ultimately stopped the market decline and demand is
showing some resilience. People are buying a little more
Earlier this month,
U.S. steelmakers led a new round of price increases, landing
hot-rolled coil in a range of $33.50 to $34 per
hundredweight ($670 to $680 per ton) and cold-rolled coil and
coated sheet at $38.50 to $40.50 per cwt ($770 to $810 per
ton). While buyers indicated that mills have remained
disciplined on higher pricing, the spread has helped some turn
to competitive imports.
"Its been pretty
easy to sell imports at this point, no question, particularly
coated (product) from India," a second trader said. "The
underlying demand hasnt changed, but maybe theres
more demand for foreign (material) in the short term.
Were now in the price difference that historic import
buyers like to see. I think clearly as the disparity between
import and domestic price increases, the mix changes,
particularly on the East Coast."
Indian and Chinese
cold-rolled coil have remained strong in the market despite
continued weakness in hot-rolled imports.
which was mainly offered from Russia, has remained in the
$30.50 to $31 per cwt ($610 to $620 per ton) range delivered
c.i.f. Port of Houston. AMMs price for
hot-rolled last week was $33 per cwt ($660 per ton) f.o.b.
Midwest mill, with some reporting buys at $32.50 per cwt ($650
cold-rolled imports for late-January and early-February
delivery c.i.f. Port of Houston at $33.50 to $34.50 per cwt
($670 to $690) against AMMs price last week of
$38.50 per cwt ($770 per ton) f.o.b. Midwest mill.
Even with the
$50-per-ton spread between domestic and foreign prices on some
products, which many see as the benchmark for moving to more
foreign material from domestic, much of a buyers decision
to buy imports also relies on how the market will look when
that material hits U.S. shores. But traders said they are
confident there wont be a collapse in the near term with
demand holding steady.
"No one is rushing to
buy imports, but were seeing people who werent
buying at all now say they want 10 to 20 percent of their
requirements filled by foreign," a third trader said. "I
dont think there is much of a risk of a collapse. The
first quarter is usually a little stronger, and the way the
trend is looking now its going to continue firming
Others agreed. "Things
are looking pretty good right now," a fourth trader said. "No
one is lining up to buy steel, but the psychology in the market
is that its not collapsing, especially with customers
keeping a tight rein on inventory. It would take some major
shock for the market to collapse, and I dont see that