Increased buying activity has pushed up spot prices for some US rebar products, while the overall market seems to be headed for a price uptrend.
Two weeks after Gerdau Long Steel North America announced a surprise $1.00 cwt. ($22/mt or $20/nt) increase effective September 19, other mills--including the usual trendsetter Nucor--have been biding their time, waiting for the scrap situation to become clear. Each day that passes without a "response" announcement from Nucor and others has only served to undermine Gerdau's efforts, and sources tell SteelOrbis that there is a strong possibility that Nucor will forge its own path in regards to October-effective rebar pricing. Specifically, their price increase will mirror the shredded scrap increase, even if scrap only goes up $10-$15/long ton, as many currently predict (strong scrap export activity has lessened the possibility of a sideways trend). If that is the case, Gerdau will have no choice but to quietly acquiesce to Nucor's move, although all mills are expected to have little resistance to higher prices.
Already, increased buying activity ahead of what many perceive to be an unavoidable uptrend in US domestic rebar pricing has dented mill inventories, especially for commonly-used sizes. Spot prices are still generally in the range of $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt) ex-mill, but some sources report that many transactions are taking place at the upper end of the range, and some have even heard of offer prices slightly above it for high-demand sizes.
On the other hand, import rebar activity has remained sluggish in the last week, as many US buyers remain cautious about market trends in Q4. However, some large transactions with Turkish mills have been heard of recently, with prices still in the range of $34.50-$35.50 cwt. ($761-$783/mt or $690-$710/nt) DDP loaded truck in US Gulf ports. Turkish mills did raise their export offers to some destinations after returning from the Ramadan holiday this week, but offers to the US have remained stable.
Meanwhile, Mexican mills are holding back most offers, waiting patiently for a consensus of sorts with US rebar prices. Sources tell SteelOrbis that Mexican mills are eager to increase rebar offers to the US, but they will not raise prices by an amount that exceeds the US domestic price increase for October. For now, any available offers remain in the range of $34.00-$35.00 cwt. ($750-$772/mt or $680-$700/nt) DDP loaded truck delivered to US border states.