Steel Products
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Ultra Light Gauge Galvanized Foreign Offers
Written by John Packard
August 19, 2013
Ultra light gauge galvanized (thicknesses less than .015”) have traditionally been associated with foreign steel suppliers as opposed to domestic mills. The U.S. mills have, over time, relegated the ultra light gauge markets as ones of the least interest due to the amount of line time it takes to produce these products versus running a heavier gauge.
In the past we have seen foreign mills take turns in wanting to be the supplier of choice for this product line which is almost all construction products (HVAC furnace pipe & fittings, ceiling grid, corner bead and expanded metal for HVAC filters). At one point in time Japan was a major supplier, then Italy came into vogue and we have seen runs at the product by Indonesia, Taiwan, South Africa and others. Now, the biggest market share comes out of India, China and Mexico.
Last week we canvassed a number of the furnace pipe buyers to see if they are in the market for new orders of ultra light gauge galvanized and where they were buying/seeing offers. We found the market is active right now with a number of the buyers negotiating for new steel right now.
We were told that the only domestic steel mills having any interest in the product are Steelscape and California Steel Industries. Other mills which can produce the product such as CSN, Sharon Coatings, The Techs, Wheeling Nisshin and Nucor Berkeley have not been able to compete with the foreign offerings for most of 2013 calendar year.
Our understanding, based on our sources, is the lowest priced providers are coming out of India with selling price offers around $39.50/cwt to $41.50/cwt CIF, Duty Paid, USA Port. Offers out of China are said to be $20 per ton or so higher and Mexico offers are said to be another $20-$40 per ton higher than China.
Looking at Nucor Berkeley extras, in order to compete on .012” X 41” 15,000# max coils going to a furnace pipe manufacturing company the mill base price would need to be $31.75/cwt (with half thickness and width extras) to be able to compete with the $41.50/cwt number.
This past week, SMU range on galvanized base prices was $36.50/cwt to $38.50/cwt with most spot buyers paying $37.00/cwt-$37.50/cwt base pricing.
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John Packard
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