Rebar prices continue to rise
A few of the major rebar producer moved up their rebar prices from their mills up $10/ton effectively immediately with orders not on the books. All existing orders will be protected until the end of the month. The two major players in the domestic industry have pushed up pricing $30/ton since mid-October now. I wish I could say the worst is over but this is still just the beginning of this expected rise as more increases are in store in the coming months it appears. The rebar market remains strong as we head into winter. The strategy seems to be more clear at this point. With tight order books, domestic mills are holding off ramping up production in a big way and using the strength in demand to do systematic price increases. The increases add 1-2% to the bottom line but seem to be sliding through and being accepted by most customers. Expect that trend to continue as the mills continue remain tight going into next year. As scrap has not finalized, once again mills have departed from using scrap to determine the direction of rebar pricing, although scrap appears to be side-ways to up for December.
On the import side, Turkish and Mexican imports will only be available to enter the US thru January as a result of the trade case filings. Shipments will be strong from these regions prior to this time frame but will fall off dramatically, afterward. Other origins are available but at higher cost structures. This will only fuel the expected increases from the domestic mills.
The scrap outlook is currently slightly up by $10 to $20/ton now for the coming weeks. This is on the heels of last month’s $30/Ton increase. Dealers are trying to keep a foot-hold on the higher level of scrap. Traditionally collections of scrap slow in the winter months reducing supply and putting further upward pressure on price. Rumors of further January increases might impact this month rise up as well.
Sales Merchant at Adelphia Metals