With early expectations of another US domestic scrap price increase in January, rumors of another US domestic rebar price increase are still strong—especially considering how easily the recent three increases (in about 5 weeks’ time) were absorbed into the market. However, even if rebar prices get one more boost before the end of the year as predicted (unless mills wait until early January for a larger increase after scrap prices settle), it’s not yet clear how long this sharp uptrend will last.
Sources tell SteelOrbis that the US import rebar market has had more to do with the domestic price increases than mills let on—although arrivals into US ports during November and so far in December are on par with 2015 levels, current Turkish offer prices for Q1 arrival are relatively stagnant at levels many US customers believe is “inflated.”
However, US rebar mills are reportedly counting on the US Department of Commerce to apply heavy margins on Turkish rebar imports when preliminary results are release in February, as the uptrend in US domestic rebar prices will depend in part on marginal competition from offshore sources. But a recent DOC review on the rebar trade case that ended in 2014 doesn’t bode well for US rebar producers—the review ruling found no subsidies from Turkish rebar mills, a finding that could carry over into the ongoing investigation.
If Turkish mills “win” this case as well, a new wave of competitively-priced Turkish rebar could “definitely” hamper the US rebar uptrend in Q1, according to sources. Until then, US domestic rebar spot prices are stable this week in the range of $28.75-$30.75 cwt. ($575-$615/nt or $634-678/mt) ex-mill, reflecting no change since last week.