Overall, pricing for November is improved from October. The improvement is based on a number of factors which are likely to be temporary with one notable exception, which is the overall strength of the US Economy.
The temporary factors include Chinese importers competing with each other to expand their total imports in 2016 because their permit for 2017 is based, in large part, on their volume in 2016. Given the length of the voyage to China and transit to the mill, the past few weeks were the final opportunity to increase volume and still have the freight arrive and be counted for 2016. Some buyers, feeling the pressure of the impending cutoff, did increase pricing to get the volume they needed for their 2017 permit.
Additonally, because some buyers restricited their orders over the summer when pricing was even higher than currently, they now must increase their buying to achieve the mill inventory levels needed to deal with the lack of shipments during the Chinese New Year. Both of these market influences are not likely to last long and are unlikely to be repeated anytime soon.
Fortunately, a more important factor, namely the strength of the US economy, is likely to endure for the near to intermediate future, all other things being equal. The recent jobs report and more specifically, the 2.8% annual wage inflation highlighted in the report, are certainly evidence that the underlying demand for goods and services in the US is strong and growing. We do expect this trend to continue which is the primarly reason we are optimistic pricing through our coming winter is likely to be higher than last year.