US domestic and import rebar prices soar to new heights

After Nucor increased rebar prices by $30 /nt ($33 /mt or $1.50 cwt.), domestic rebar prices for March delivery now range from $28.90 cwt. to $29.40 cwt. ($637 /mt to $648 /mt or $578 /nt to $588 /nt) ex-mill. While Nucor usually opts to keep prices stable from month to month to prevent wild fluctuations, the domestic market leader could not ignore the $40 /nt ($44 /mt or $2.00 cwt.) increase in shredded scrap and chose to decrease rebar base prices by $10 /nt, to result in a net increase of $30 /nt. Customers almost certainly will accept this price increase; Market players say that the rebar market is strong enough now that Nucor and other domestic producers could have increased prices the full $40 /nt. The pricing trend for domestic rebar is still up, and even if scrap prices go down in the next couple months, Nucor will at least keep prices stable. Demand is decent and is expected to improve as more construction projects start up, however, for the time being, harsh weather conditions in the Midwest and East are preventing heavy construction activity. After a slow fourth quarter, buyers didn't dare to buy their usual spring orders, and this will inevitably create local shortages. There is very little inventory on the ground, and not very much import rebar tonnage will arrive in March or April. Shipments will start to arrive again in May and June. Import prices also continue to trend up because the world market is still hot, and US customers are starting to accept the higher numbers offered by import mills. In the last week, import offering prices have increased by about $0.50 cwt. ($11 /mt or $10 /nt), with most import ofers now ranging from $28.50 cwt. to $29.50 cwt. ($628 /mt to $650 /mt or $570 /nt to $590 /nt) FOB loaded truck, in US Gulf ports. Similar prices are valid for West Coast discharge, primarily from Asian sources. Traders tell SteelOrbis that the Turkish mills are back in the market, offering at numbers about $30.00 cwt. ($661 /mt or $600 /nt). People aren't accepting the Turkish offers yet, but the Turkish mills are not anxious to sell to the US since they are getting plenty of business from the other markets. Turkish mills are full for March rolling and are now talking about April rolling. License data from the US Steel Import monitor shows that during the month of January 2007, the top import rebar sources were: Turkey, at 37,333 mt; Malaysia, at 28,113 mt; Mexico, at 22,617 mt; Brazil, at 18,748 mt; and Japan, at 10,806 mt. The total amount of rebar tonnage imported to the US in January 2007 was 133,188 mt, compared to the record high of 335,696 mt imported in September 2006.