May Import Share of US Sheet and Plate Markets

Imports’ share of total sheet shipments into the US was 15.7% in May, down from 16.9% in April and well below the peak of 19.5% set in January. The decrease was driven by a 6.3% decline in foreign sheet. The market share of plate product imports also slipped in May to 20.5% from 21.9% the month prior.

May’s sheet imports totaled 769,371 tons, down from 821,490 tons in April, and the lowest total since June 2021.

Overall sheet product shipments (domestic shipments plus imports) were up marginally in May, 0.9% above April’s total. They totaled 4.89 million tons in May, up slightly from 4.85 million tons in April and were driven by a 95,856-ton increase in domestic shipments despite a decline in foreign material.

Despite the overall decline in sheet product shipments, hot-rolled coil (HRC) imports rose MoM in May and totaled 212,978 tons versus 193,020 tons in April, up 10.3% MoM. The details are below in Figure 1.

The import share of HRC rose 0.4 percentage points to 10.9% in May and is historically still a healthy share but far off from the recent high of 15.3% set last October. The increased share was driven by a stronger rise in foreign material, though domestic shipments also rose MoM, but at a slower pace. HRC apparent supply totaled 1.96 million tons in May, up from 1.83 million tons the month prior.

Imports of cold-rolled coil (CRC) were also up (+10.9%) in May, while galvanized (hot dipped and electrolytic), and other metallic coat (OMC) were both down. Galvanized saw the greater percentage decline at -19.2% MoM followed by OMC at -14.9%.

Plate products in May saw an overall increase in shipments as apparent supply rose by 2.3% MoM. The increase was driven by a gain of 4.2% in domestic shipments, while plate imports declined by 4.3%. May plate imports of 158,185 tons were the second-lowest total in more than seven months. All told, total plate shipments, including foreign and domestic, were 773,141 tons in May, up from 755,799 tons the month prior.

The import market share for plates in coil fell to 44% in May, a 1.5 percentage point decrease MoM. The decline in market share was driven by a 12.4% increase in domestic shipments, even though imports were up 6% MoM. Total imports of plates in coil were 123,689 tons in May, up from April’s 116,677 tons.

The table below displays the total supply to the market in three months and 12 months through May 2022 for sheet and plate products and six subcategories. Supply to the market is the total of domestic mill shipments plus imports. It shows imports on the same three- and 12-month basis and then calculates import market share for the two time periods for six products. Finally, it subtracts the 12-month share from the three-month share and color codes the resulting green or red according to gains or losses. If the result is positive, it means that the import share is increasing, and the code is red.

The big picture is that imports’ share of US sheet and plate sales tumbled in May for the second straight month following a strong surge in March. The big second-half jump in total imports was the result of historically and disproportionately high domestic steel prices. The influx of foreign material had been declining, coinciding with lower domestic prices. The war in Ukraine shifted that dynamic, pushing prices higher, but fundamental demand did not provide support to rising prices. The rally was short-lived as prices have been tumbling quickly while foreign steel has also arrived at US ports at a slower pace.

Hot-rolled and cold-rolled sheet and strip have seen a trend shift along with plate products, illustrating how import competition is impacting domestic products in three months compared to 12 months. The most notable of those subcategories is HRC and plate in coil, which have both seen a declining import market share through May.

The import market share of individual plate products as well as a breakdown of the market share for plates in coil are displayed together in Figure 2. The historical import market share of plate and sheet products, and the import market share of the four major sheet products, are shown side-by-side in Figure 3.

By David Schollaert, David@SteelMarketUpdate.com