Although spot prices in the US domestic rebar market have remained firm in the last week, questions abound as to how much of the price strength is due to purchasing activity.
After a successful price increase this month, many in the US rebar market expect mills to go for another increase for November shipments once scrap pricing becomes apparent, with the actual rebar increase only depending on whether scrap goes sideways again (as most believe) or comes down slightly (even a $5/long ton decrease in scrap won't discourage rebar mills, sources say).
However, despite the apparent strength in US rebar prices, questions as to the strength of buying activity have begun to crop up. Sources tell SteelOrbis that purchasing activity isn't exactly robust, and because of this, quiet deals have been heard between rebar mills and certain distributors. While the value of such deals is minimal--most falling between $0.25-$0.50 cwt. ($5.50-$11/mt or $5-$10/nt)--their very existence seems to indicate that rebar pricing's recently strong trend might not last much longer. For now, US domestic rebar spot prices remain in the range of $36.00-$37.00 cwt. ($794-$816/mt or $720-$740/nt) ex-mill, but the success or failure of the predicted November price increase will say much about the market's true trend.
As for imports, Turkish mills are still flexible with their import rebar offerings, but because US buyers are largely disinterested in imports at the moment, the flexibility is being met with mostly silence. As such, import sales prices remain unchanged in the last week, still falling into the range of $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt) DDP loaded truck in US Gulf ports. Any interest in Turkish rebar for the remainder of the quarter largely depends what US mills do--if they stick to their guns with another price increase, imports might start to look a little more desirable.
Mexican mills are also feeling the pressure of US buyer disinterest, and sources tell SteelOrbis that mills south of the border are not selling as much as they'd like to, and thus might drop prices in the near term. However, current offers of $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt) DDP loaded truck delivered to US border states will likely hold until at least another week, as Mexico watches US rebar movements eagerly.