Galvanized buyers see prices flat to down next month

Written by Ethan Bernard

Prices for galvanized products have fallen from last month, and many market participants expect tags to continue their descent or, at best, remain flat in the month ahead.

Service centers, distributors, and manufacturers who are members of the Heating, Air-Conditioning & Refrigeration Distributors International (HARDI) association met virtually on Tuesday, May 21, for the monthly meeting of HARDI’s Sheet Metal/Air Handling Council.

One member said there is still a big spread between hot-rolled coil (HRC) and galv. He mentioned the influence of higher zinc prices.

“While not necessarily in carbon steel, it’s certainly a big factor on galvanized steel in terms of delivered price with zinc,” he said.

“Coating extras are likely going up,” he added, noting: “So it’s not a great month to be selling steel that we bought six weeks ago, but it is what it is, and we deal with these kinds of markets.”

SMU Managing Editor Michael Cowden did point out on the call that U.S. Steel’s Big River Steel operations in Osceola, Ark., recently raised the prices of coating extras.

Another call participant said that “demand has eased up a bit and that can be temporary as we get into the late spring and summer with things going on.”

He said that he’s seeing shorter pricing cycles. “And so it really doesn’t give us an opportunity to get momentum going,” he commented.

Galvanized sheet prices

Each month on the HARDI Sheet Metal/Air Handling Council call, a survey is conducted to see where members see galvanized steel prices moving in one, six, and 12 months.

On April’s call, the vast majority of members predicted prices for galvanized sheet would remain flat or fall for the next month. That latter prediction proved to be accurate.

The call moderator said on this month’s call that “we were probably around a $58(/cwt) base price for galvanized and they’ve fallen noticeably.” He estimated the fall at $5/cwt “and (prices) seem to be headed lower,” with the average weekly decline totaling about $1/cwt ($20/short ton).

 SMU’s galvanized coil price averaged $1,045/st ($52.25/cwt) FOB mill, east of the Rockies as of May 21.

This month, 39% of members on the call predicted galvanized prices would fall more than $2/cwt over the next 30 days. More than half (57%) think prices will be flat (+/- $2/cwt), while only 4% expect prices to increase by more than $2/cwt.

Only 17% of members think galv prices will fall over the next six months, while 35% predicted flat pricing. And 48% expect prices to rise at least $2/cwt in the same time period.

Looking out a year from now, 74% see galv prices in the range of $50-59/cwt, while 17% foresee higher pricing.

SMU participates in a monthly steel conference call hosted by HARDI and dedicated to better understanding 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.

Ethan Bernard

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