US domestic rebar and wire rod prices remaind flat this week, even as pricing for February scrap posted gains for now a third straight month, market insiders told SteelOrbis. And while continued increases in scrap prices will certainly raise US mills’ steel production costs, not all are convinced further price increases from US mills are forthcoming, at least not right away.
Additional mill price increases, they contend, could encourage the entry of an increased amount of long steel imports, prompting US mills to give back key market share gained after 50 percent steel tariffs reduced imports to a trickle earlier this year. Reports continued this week that long steel supply currently is in transit from South Korea and is expected to arrive in the US during March and April.
At press time, initial data from the Washington, D.C.-based International Trade Administration’s (ITA) US Steel Import Monitor, finds rebar import licensing requests totaled 62,618 mt for February, down nearly 25 percent compared with a 83,243 mt total in January and 103,281 mt in February of last year. Year on year, licensing data requests are off by 19.4 percent.
In the weekly rebar spot markets, domestic supply on an FOB mill basis was assessed with most transactions noted at $48.00-49.00/cwt, ($960-980/nt or $1,058-1,080/mt), on average $48.50/cwt, ($970/nt or $1,069/mt), unchanged from a week earlier.
“Prices already have increased a lot. Some people are skeptical that price increases will continue because of a general pessimism about the economy,” said a long steel insider.
Following the winter storm three weeks ago, many US states have returned to more moderate temperatures, but the Midwest and Northeast remain cold, causing continued slow shipments of steel scrap.
“Scrap is up, but there is a lot of hesitation in the market as far as a new potential [price] increases,” said a SteelOrbis insider, “I have also heard there is a lot of import rebar coming in.”
US prime busheling Midwest scrap for February delivery was up $30/gt this week, settling at $445-455/gt ($451-461/mt). Midwest shredded scrap gained $30/gt to $445-450/gt ($452-456/mt), while cut grades, like P&S and HMS, settled $20/gt higher at $421-431/gt ($427-437/mt) and $385-405/gt ($390-410/mt).
In the domestic wire rod market, domestic supply on an FOB mill basis was assessed with most transactions reported steady at $48.00-49.00/cwt ($960-980/nt or $1,058-1,080/mt), or an average of $48.50/cwt ($970/nt or $1,069/mt), unchanged from seven days ago.
“Liberty is not producing as much, and not keeping their promises,” remarked a long steel insider. Continued outreach by SteelOrbis to media officials at the 700,000 ton per year Liberty facility remained unsuccessful at press time.
According to a recent Associated Builders and Contractors survey, “US construction backlog fell to 8 months in January, down 0.2 months from December and now sits at its lowest level in four years”. On the domestic long steel demand side, insiders reported an improving US construction industry sentiment as infrastructure and data center projects “regain traction.”
