US domestic rebar and wire rod prices were steady to down this week as domestic long steel demand struggles even as scrap prices traded sharply lower for a second straight month, market insiders told SteelOrbis this week.
The decrease in May scrap pricing, which settled $30-40/gt ($30-41/mt) less than April pricing this week, was expected to trade lower for a second straight month due to a combination of solid inventory levels at scrap yards, minimal demand from domestic and overseas mills as well as declining flat steel prices.
In the weekly rebar spot markets, domestic supply on an FOB mill basis is assessed with most transactions noted at $37.50-39.00/cwt. ($750-780/nt or $827-860/mt), on average $38.25/cwt. ($765/nt or $843/mt), unchanged from seven days ago.
“The domestic rebar market is flat, but the demand is steady,” commented one SteelOrbis long steel market insider.
In the domestic wire rod market, most transactions were reported this week at $44.50-45.50/cwt. ($890-910/nt or $981-1,003/mt), or an average of $45.00/cwt. ($900/nt or $992/mt), down $0.50/cwt. ($10/nt or $11/mt) from seven days ago.
Insiders told SteelOrbis that output from the recently restarted 700,000 ton per year Liberty wire and rod mill in Peoria, Illinois, has started to become available to buyers in daily spot markets.
“Liberty Steel has continued (to increase production), and they have offered into the open market as well,” said another long steel insider. “Their prices are high, but their presence has eased any supply concerns.”
While lower May scrap prices could spur some domestic mills to further reduce long steel price offers, further declines might be limited going forward as early reports on the expectation for June scrap prices indicates a developing sideways expectation. And potential gains for long steel going forward might be more limited since raising domestic pricing could make imports a more attractive alternative, insiders said.