With the domestic price increase for July and the tightening import supplies on the ground, rebar traders in the US are now selling their material at over $50 cwt. in the Gulf, and these numbers are not finished rising yet.
There are still some distributors selling import rebars at approximately $48.00 cwt. to $49.00 cwt. ($1,058 /mt to $1,080 /mt or $960 /nt to $980 /nt) FOB loaded truck in the Gulf, but those deals will be disappearing soon. Based on the previous purchase price of the Turkish material they now have in stock, traders are currently shooting for a range of $50.00 cwt. to $52.00 cwt. ($1,102 /mt to $1,146 /mt or $1,000 /nt to $1,040 /nt) FOB loaded truck in US Gulf ports, with a significant extra for #3s. These numbers are set to go up as well, to the tune of $3.00 cwt. to $4.00 cwt., in the coming weeks.
Mexican mills are still offering some material in a range of approximately $53.00 cwt. to $54.00 cwt. ($1,168 /mt to $1,191 /mt or $1,060 /nt to $1,080 /nt) delivered to California, and about $2.00 cwt. less in Texas and Florida. Besides this Mexican material, however, virtually no other import rebar shipments are expected to arrive this summer, and this lack of imports will continue to tighten up inventories and drive prices towards the sky.
On the domestic side of the market, domestic mills' $20 /nt to $30 /nt increase on 20-footers has driven domestic spot prices, overall, up by about $10 /nt (in addition to the $35 /nt July increase in base prices). Although US mills at one time offered a so-called "foreign fighter" discount for 20-footers, now they are doing just the opposite since they no longer have to worry about import competition. Spot prices for domestic rebar now range from approximately $49.00 cwt. to $49.50 cwt. ($1,080 /mt to $1,091 /mt or $980 /nt to $990 /nt) ex-mill, and with import prices still surpassing the domestic price for July shipments, the domestic pricing trend remains up for August as well. Traders who inquire for export tons from domestic mills hear the same story on a regular basis: The mills are busy, and there are no tons to export for the time being.
Updated May license data show a significant decrease in rebar imports both year-on-year and from the previous month. License data show 46,795 mt in total rebar imports for May, compared to 157,383 mt in April and 218,161 mt in May 2008.The vast majority of the import rebar licenses for May 2007 are from Mexico, at 37,760 mt. After Mexico, the largest sources in May were Japan, at 4,714 mt; Dominican Republic, at 2,546 mt; Canada, at 1,436 mt; and Germany, at 217 mt.