HARDI members see galvanized tags falling as bottom nears

“So what we’ve seen over the last 30 days is that we’ve seen prices fall even farther,” the call moderator said, noting they declined more than many had expected. 

“I guess we were hopeful that they would not fall this far, but they have,” he added. “And, honestly, there’s not a whole lot of positive fundamentals in place for prices to reverse course, or at least reverse course to the level that we’ve seen in these last two cycles.” 

One HVAC distributor described demand as “decent.” 

“Our volumes are good as well, even though we’re finding margin compression and downward steel pricing — plenty of supply out there,” he commented. 

A service center call participant, commenting on the Midwest and Southeast, said demand was lower. “So, I mean, demand is definitely, you know, not where we like to see it.” 

However, another service center call participant was slightly more optimistic, commenting that he’s been seeing higher volumes in the past three to four weeks.

“We actually had one of the largest shipping days of the year included in that. So we’ve seen some of that, people are coming off the sidelines a little bit,” he continued.

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 June’s call, two-thirds of members in attendance expected prices to fall, while the remaining third believed prices would be flat. The former prediction proved to be right.

The call moderator noted that galvanized prices have fallen ~$6.00/cwt since the last call a month ago. Additionally, he said the galv base price is off 15% from one year ago at ~$43.50/cwt.

SMU’s galvanized coil price averaged $635 per short ton ($31.75/cwt) FOB mill, east of the Rockies, as of July 23.

This month, 25% of members on the call predicted galvanized prices will fall more than $2/cwt over the next 30 days, and 58% expected prices will be flat (+/- $2/cwt). In a big change from last month when no participants foresaw higher prices, this month, 13% think prices will be up more than $2/cwt, and 4% predict they will be up more than $4/cwt.

As for prices over the next six months, 83% think galv prices will rise at least $2/cwt over the next six months, 13% believe prices will be flat, while 4% expect prices to fall.  

One year out from now, 52% think galv prices will be in the range of $50-59/cwt, 30% predict a range of $60-69/cwt, and 17% anticipate a range of $40-49/cwt.

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