Flat rolled steel imports on the increase
time2017/09/07
Flat rolled steel imports on the increase
Total rolled steel imports increased by 10.8 percent in the three months through August compared to the three months through May. Sheet product imports rose by 14.3 percent on the same basis, according to final license data for August reported by the U.S. Commerce Department on Aug. 6.
The data is reported within the Steel Import Monitoring and Analysis (SIMA) system. An explanation of the methodology used to analyze the trade data is given at the end of this piece, together with notes describing SIMA. All volumes are reported in short tons.
The three-month moving average (3MMA) of rolled product imports in August was the highest since May 2015. The August increase was all in flat rolled. Semis and long products declined. Total rolled product licensed imports in the single month of August were 2,532,496 tons with a 3MMA of 2,727,510 tons. We prefer not to dwell on single-month results because of the extreme variability that can occur in individual products. In the comments below, we use three-month moving averages to give what we believe is the most accurate picture.
Figure 1 shows the 3MMA through August of licensed tons of semi-finished, flat and long products since January 2004.
Imports of semi-finished in August had a 3MMA of 775,559 tons, which was up by 16.5 percent year over year. “Flat” includes all hot and cold rolled sheet and strip, plus all coated sheet products, plus both discrete and coiled plate. The 3MMA of flat rolled imports was 1,284,782 tons in August, which was the most since September 2015. Long product imports have been range bound between 519,000 tons and 772,000 tons since August 2014 with no trend evident. In August 2017, the 3MMA of long product imports was 627,657 tons.
Figure 2 shows the 3MMA trend of sheet and strip product imports since January 2004. The total of these products was up by 14.3 percent in three months through August compared to three months through May and up by 10.6 percent year over year
HRC imports declined sharply in the five months through February, but have increased since. CRC and HDG are currently both higher than HRC on a 3MMA basis, which is very unusual. Other metallic coated (OMC), mainly Galvalume, increased sharply by 35.2 percent in three months through August compared to three months through May. Tin plate and electrogalvanized imports have been relatively flat for over a year.
Table 1 provides an analysis of major product groups and of sheet products in detail. It compares the average monthly import tonnage in the three months through August 2017 with both three months through May (3M/3M) and the three months through August 2016 (Y/Y).
Imports of all sheet products except electrogalvanized were up in the three-month comparison led by other metallic coated. Only HRC, electrogalvanized and tin plate had any relief compared to the year-ago results. Plate was up by 21.9 percent. Year over year, the total of all rolled product imports was up by 19.6 percent, plate products were down by 15.5 percent, total sheet products were up by 10.6 percent, tubulars were up by 121.9 percent and long products were down by 6.0 percent.
There were big differences between the individual sheet products compared to last year, ranging from HRC, down by 12.7 percent, to other metallic coated, up by 32.2 percent. Table 2 shows the same analysis for long products. The total tonnage of long product imports was down by 39,890 tons per month Y/Y. On a 3M/3M basis, the total volume of long products declined by 0.7 percent.
Figure 3 shows the import market share of sheet and long products through June, which is the latest data available. The import market share of sheet products peaked at 24.3 percent in March 2015. The June 2017 level was 21.3 percent. Long product import market share has been considerably higher than for sheet products since early 2015 and in June was 28.7 percent, the highest since May 2015.
Figures 4 through 7 show U.S. mill shipments to domestic locations, imports and import market share for the four major sheet products. Note that the righthand import share axes are the same to give true comparability. HRC has the lowest import share followed by HDG, CRC and OMC, which is by far the highest.
Our analysis is based on the final import volumes through June. Net imports equals imports minus exports.
We regard this as an important look at the overall trade picture and its effect on demand at the mill level. Figure 8 shows net sheet product imports on a 3MMA basis to be 625,395 tons in June, which was the highest since September last year. Exports have increased in 2017, driven by the depreciation of the U.S. dollar on the international foreign exchange markets. Net sheet steel imports are high by historical standards.
