US rebar market sees hope on the horizon

Thursday, 30 December 2010 02:29:12 (GMT+3)   |  
       

While domestic demand for rebar is not spectacular, a steady stream of purchasing activity has helped support price increases for January shipments.

Average transaction prices for domestic rebar have not changed in the last week, but nevertheless, the trend is still decidedly up.  Well-established customers are still buying rebar in the range of $32.00-$33.00 cwt. ($705-$728/mt or $640-$660/nt) ex-mill, while newer customers are paying closer to $34.00 cwt. ($750/mt or $680/nt) ex-mill--both levels are considerably up from month-ago prices, reflecting the general success of both the early-December announced $1.00 cwt. ($22/mt or $20/nt) immediate base price hike and the RMS increase of $2.25 cwt. ($50/mt or $45/nt) announced a week later. 

SteelOrbis has learned that demand for rebar, which has not spectacularly improved over the year, is just beginning to see the first hints of a steady uptrend, which has helped to bolster the scrap-based price increases.  Another rebar price hike is expected to be announced next month following the near-certain scrap increase, but after that, the demand situation will be crucial in rebar pricing.  Early speculation points to a scrap price decrease in March, but whether or not mills roll back rebar pricing to reflect the scrap situation depends on the endurance of current upticks in demand.  If these upticks are only reflective of inventory restocking, then mills will soften their pricing.  But if end-use activity is driving the demand, mills won't be so quick to give up their recently-achieved gains.

Another side effect of this situation is import activity--import queries have increased in the last few weeks, and several bookings have been concluded at decent margins from domestic prices.  But without a clear view of what domestic pricing will be in March and April (when currently-placed import orders arrive), domestic buyers are starting to become hesitant about shipping from overseas.  Consequently, there has been no movement in import offers from Turkey in the last week, with offers still in the range of $32.25-$33.25 cwt. ($711-$733/mt or $645-$665/nt) duty paid FOB loaded truck in US Gulf ports.  However, offers in lower end of the range are starting to dry up.

South of the border, Mexican offers have also remained neutral, but mostly because they are full for January.  Last week, SteelOrbis reported prices of $32.00-$33.00 cwt. ($705-$728/mt or $640-$660/nt) duty paid FOB delivered to US border states, but those prices will probably not be available for February shipments.  Mexican rebar price movements have mirrored US developments lately, and however much US prices increase, Mexican prices will follow.


Similar articles

Import longs offers in Romania now attractive, local prices stable

28 Mar | Longs and Billet

Turkish domestic dollar-based rebar spot prices soften

28 Mar | Longs and Billet

Major steel and raw material futures prices in China - March 28, 2024

28 Mar | Longs and Billet

Rebar consumption in Mexico decreases 3.1 percent in January

27 Mar | Steel News

US rebar prices mostly stable with occasional deals

27 Mar | Longs and Billet

Downtrend reverses in Pakistan’s import scrap segment

27 Mar | Scrap & Raw Materials

Turkey seeks to raise rebar export offers, demand mostly seen locally

27 Mar | Longs and Billet

Iskenderun-based Turkish mill increases its rebar price      

27 Mar | Longs and Billet

Major steel and raw material futures prices in China - March 27, 2024

27 Mar | Longs and Billet

US import rebar market remains quiet

26 Mar | Longs and Billet