While there appears to be a consensus on the outlook for the US domestic rebar market—sources confirm strong demand will continue to bolster higher prices—the actual price range is up for dispute after four mills released varying increase announcements in the last few days. On the low end, Nucor bumped prices by $1.75 cwt. ($35/nt or $39/mt), while CMC and SDI pushed for a high-mark of $2.25 cwt. ($45/nt or $50/mt). Most interestingly, however, was Gerdau’s moderate $2.00 cwt. ($40/nt or $44/mt) price bump with an additional $1.00 cwt. ($20/nt or $22/mt) for the “distribution market.”
Sources tell SteelOrbis that Gerdau’s fabricator-favoring move won’t turn out to be as clear-cut as it seems—certain distributors will likely negotiate deals for below the combined $3.00 cwt ($60/nt or $66/mt) in increases, while favored customers on all levels of the supply chain will continue to cut deals with other mills as well. So even though the domestic market as a whole is strong—thanks in large part to demand plus rapidly-rising import offers—spot prices are “all over the place” according to sources.
SteelOrbis is still hearing transactions at the low end of last week’s spot range—$28.50 cwt. ($570/nt or $628/mt) ex-mill—even though the recent mill increases were all effective immediately. And on the high end, spot prices have reached up to $34.00 cwt. ($680/nt or $750/mt) ex-mill, taking into account most of the mill announcements. The success of Gerdau’s extra $1.00 cwt. for distributors remains to be seen, but sources say there’s a strong likelihood of a spot range shift upward by next week.