New Report Preview  - Steel Market

December preliminary steel imports posted a surprising monthly decline, falling 5.3% to 2.0 million tons (mt) from October’s 2.11 mt, the lowest level since February and some 32.6% below the peak in May.  December licenses had suggested an increase of as much as 9% driven by a 50%-plus surge in semi-finished steel; however, actual semi-finished imports rose just 5.3%.  We suspect that some tonnage meant for December arrival was actually received in November as actual imports in November were 4% higher than licenses had suggested.

The monthly decline was driven by lower imports of cut-to-length plate (down 26.7%), OCTG (down 17.1%) and sheet (down 12.8%). However, based on current licenses, these declines are likely to be short-lived as tonnage for these products look set to increase in January, with significant increases possible for cut-to-length plate and OCTG.

In addition to slightly higher imports of semis, tonnage for rebar and wire rod jumped some 48.9% and 48.8%, respectively. Rebar licenses for January are showing an even further uptick, which could lift rebar imports to the highest level in nearly four years – which helps explain domestic steelmakers recent decision to hike domestic rebar prices less than other long products.

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