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W. Coast still receiving China cold-roll offers

Keywords: Tags  steel, cold-rolled, galvanized, China, New Zealand, South Korea, Frank Haflich


LOS ANGELES — Offers of Chinese cold-rolled steel continue to trickle into the West Coast as buyers turn their attention to possible alternative offshore sources if a rumored trade complaint is filed.

Although certain large trading companies, wary of trade action by U.S. mills that could leave them liable for sanctions, are reportedly suspending offers of Chinese cold-rolled. Quotes, estimated at $630 to $640 per ton ($31.50 to $32 per hundredweight), have continued to arrive for commercial-quality coil to be delivered late this year or early in 2015.

But rumors of an impending trade case against cold-rolled and coated imports have already spurred several buyers to fill their overseas requirements through the remainder of the year, and most indicate they won’t be buying much imported material due to land in 2014 or even January of next year.

"We’re pretty well set," said one coated steel buyer who has relied heavily on imports, noting that with five-week lead times available from U.S. mills, domestic material can be used to plug any inventory holes that might develop. "We’ll just ride out the rest of the year."

Still, the threat of trade complaints against imports of Chinese cold-rolled and coated material has prompted some buyers and traders to contemplate alternatives, although it’s generally conceded that any discounts to domestic prices wouldn’t be near as large as those on Chinese coil, which are reportedly as high as $160 to $180 per ton for cold-rolled and $100 to $120 per ton for galvanized.

"There’s tremendous interest" in what future supply role South Korea might play in cold-rolled and galvanized on the West Coast, one trading source said. Korea is already considered the primary import factor on hot-rolled coil in this market.

The West Coast’s largest cold-rolled producer, Pittsburg, Calif.-based USS-Posco Industries Inc., has been evaluating its own anti-dumping complaint against China based on regional considerations. But it’s believed the mill would defer to any action by its counterparts east of the Rockies, including its 50-percent owner, Pittsburgh-based U.S. Steel Corp.

Recent cold-rolled coil offers from South Korea and New Zealand were estimated at $35.50 per cwt for October to November shipment, although sources view these as initial quotes that may be negotiable. This compares with estimates of $39 to $40 per cwt for domestic cold-rolled.

While Korea has been reported among the possible targets of any cold-rolled and coated sheet trade case (amm.com, Aug. 26), some market sources maintain that country’s mills have been scrupulous about marketing these products at prices that won’t jeopardize their attractive automotive-quality business associated with Korean auto manufacturing transplants in this country.

"I don’t think the Koreans have much intention of sending in large amounts of commercial quality cold-rolled to the West Coast" and risking the loss of more lucrative business, said one market observer.

Foreign shipments of cold-rolled annealed sheet into the West Coast through June were up nearly 53 percent to about 144,700 tons from 94,600 tons during the same period in 2013, one market source said. For June, they more than doubled to about 29,400 tons in June vs. 13,100 tons the year before.

Meanwhile, arrivals of bare galvanized sheet in the first six months rose more than 90 percent to about 148,500 tons from 77,800 tons in the same period last year, while June imports were approximately 27,100 tons vs. 8,000 tons in June of 2013.

China was the source of over 90 percent of West Coast cold-rolled imports and over 85 percent of galvanized arrivals, according to the source.


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