US rebar distributors in the Midwest and West Coast say that inventories are growing leaner from the lack of imports, and that they will likely have to push up their prices as a result.
With only scattered imports from Japan and Mexico arriving this summer, the situation on the ground will grow tighter in the next couple months, and distributors are expected to push their prices up in line with any domestic price increases that come.
In the Gulf, traders say that there is still a decent amount of steel on the ground, but that no one is in a hurry to sell at the current market level for import rebar in the US, which is still at a range of $48.00 cwt. to $49.00 cwt. ($1,058 /mt to $1,080 /mt or $960 /nt to $980 /nt) FOB loaded truck in US Gulf ports. Traders expect the accepted price level to rise along with the domestic mills' prices this summer and are waiting until prices reach their maximum before they start offering again.
Mexican offers are still at a range of $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 $1.00 cwt. to $2.00 cwt. less in the Gulf. Mexico is expected expected to remain in the market for a while as there are no other significant import rebar sources at present. There are still no offers being entertained by Turkey, though traders do reportedly have some material ordered months ago that is on its way to the US, which they will have to sell at no less than $51.00 cwt. FOB loaded truck in the Gulf.
Domestically, as we reported last week, the rebar pricing trend is still slightly up despite indications that shredded scrap prices may come down in June. With domestic material still significantly under the import price, at a range of $46.70 cwt. to $47.25 cwt. ($1,030 /mt to $1,042 /mt or $934 /nt to $945 /nt) ex-mill, domestic mills still have room to raise their numbers closer to the international levels. However, with shredded scrap prices expected to come down by as much as $30 /long ton in the Midwest this month, rebar producers will likely only raise their transaction prices by a small amount.