Although the latest US domestic rebar price increase was reportedly absorbed into the market almost immediately, sources tell SteelOrbis that some large distributors—particularly those affiliated with US rebar mills—are receiving “substantial deals” below the general spot price range.
Most buyers are subject to the new US domestic rebar spot price range of $36.25-$37.25 cwt. ($725-$745/nt or $799-$821/mt) ex-mill, which includes the $2.00 cwt. ($40/nt or $44/mt) price increase that went into effect immediately almost two weeks ago. However, some sources report large distributors and service centers paying up to $4.00 cwt. ($80/nt or $88/mt) less, depending on the size of the order.
Competition within the US domestic rebar market is tighter now that Gerdau is selling most of its US rebar assets to CMC, leaving smaller and medium-sized rebar buyers “nowhere to turn” for deals among US steelmakers. As such, sources predict a resurgence of import demand, which lagged in the second half of 2017 due to concerns over the Section 232 investigation. Now that results from the investigation await a response from the Trump administration, importers reportedly remain cautious, but many are no longer concerned that major steel tariffs against rebar are in the future. Already, import arrivals are beginning to pick up this month, and sources point to lower-priced positions at the ports as a viable alternative to high domestic prices.