Final Thoughts

HARDI Members Say Galv Demand is Stable

Written by Becca Moczygemba

Demand for galvanized sheet is stable, according to members of the Heating, Air-Conditioning & Refrigeration Distributors International (HARDI) Sheet Metal/Air Handling Council.

A few high points from this month’s meeting are that prices have climbed for the first time since April, import levels are low, and the spread between hot-rolled (HR) and galvanized material is normalizing.

When comparing the annual base prices for galvanized year over year, 2020 was by far the lowest, starting at $38 per cwt. There was a jump to $53/cwt at the start of 2021, and then a leap to $100/cwt at the beginning of 2022. HARDI members noted a price of $43/cwt to kick off 2023, and are curious to see where the numbers go. 

Although pricing has been slowly creeping up, HARDI members state the increase hasn’t been reflected in their sales price.

“We’re working through inventory that’s already in the system, so we haven’t seen transactional price increases yet,” one member said. 

Despite rising prices, most HARDI members acknowledged stable demand so far in 2023. One member in the Midwest expressed a positive outlook for Q1. “We’ve seen strong demand so far. We’ve had a mild winter, so we haven’t lost any shipping days. Long-term demand is expected to be decent based on contractor backlog,” he said.  

“It’s been an interesting year,” said one HARDI member located on the West Coast. “January has been stable, but there’s been lots of sporadic movement between heavy ship days and light ship days. In the second quarter we expect to see higher prices, then start to flatten over the following months,” the meeting participant said. 

Another member expressed that capacity utilization could continue to increase despite word that other sectors are up. 

A member that operates in multiple locations echoed the positive demand sentiment. And although he noted that volume is up year over year, he said there have been some holes among service centers. 

Still, another member on the East Coast, who serves the commercial construction sector, has seen strong demand across all product lines. Multi-family construction and structural companies are especially busy, he noted. “It depends on the broader economic factors in those areas,” he said, referring to various major cities in the Northeast. One additional thing, he added, is that tech companies on the East Coast have pulled back on construction of their facilities. Additionally, there has been an increase in bookings for HR material.

On the Jan. 24 HARDI call, 40% of members present predicted galv prices would be relatively flat (+/- $2/cwt or $40/ton) over the next month. Another 43% predicted prices to be up more than $2/cwt, and 13% said prices would be up more than $4/cwt. Looking out six months, 30% anticipate prices to be down more than $2/cwt, while 27% predicted flat pricing, and another 27% anticipate prices to be up more than $2/cwt.

Steel Market Update participates in a monthly steel conference call hosted by HARDI. The call is dedicated to a better understanding of the galvanized steel market. The participants are HARDI member companies, wholesalers who supply products to the construction markets. Also on the call are service centers and manufacturing companies that either buy or sell galvanized sheet and coil products used in the HVAC industry and are suppliers to the HARDI member companies.

By Becca Moczygemba,

Becca Moczygemba

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