US domestic rebar prices slipped this week amid continued reports of plentiful supply and low demand, as a growing market expectation is developing that trade tariffs announced by US President Trump and retaliatory actions taken by key nations could cause construction and other US prices to rise, potentially slowing US economic activity in the key second and third quarter, market insiders told SteelOrbis.
And, while tariffs are seen as somewhat helpful to struggling US steel producers, tariffs could potentially lead to substantially higher costs for several industries that depend on steel imports like US auto parts manufactures, they said.
Mid-afternoon on April 9, US President Trump announced a 90-day pause in the implementation of reciprocal tariffs against all nations seeking to export their products into the US, to give countries “more time to negotiate their tariffs,” Trump said on social media platform Truth Social. During the pause, tariffs will be set at a “floor” of 10 percent, Trump said.
At the same time, Trump hiked “stacked tariffs” against China to a combined 125 percent rate after China announced retaliatory actions of it own and filed a complaint under the World Trade Organization’s (WTO) dispute settlement mechanism against the US’ latest tariff increases.
“Demand is still lukewarm, and lower overall than it has been over the last several weeks,” said one long steel market insider. “As it now stands, we can pretty much forget about anymore price increases from the mills.”
Recently, insiders said mills have been raising finished steel prices such as for hot-rolled coils, because of recent hikes in the price of US scrap. As a result, the mill price increases have made imports more competitive, they said, therefore many mills are reluctant to continue to raise prices. And, as scrap supplies, especially shredded scrap, have increased following recent increases paid to sub-collectors, April scrap prices are expected to settle $20-40/gt ($20-41/mt) less than March values, insiders said.
In the weekly rebar spot markets, domestic supply on an FOB mill basis is assessed with most transactions noted at $38.50-40.00/cwt. ($770-800/nt or $849-882/mt), on average $39.25/cwt. ($785/nt or $865/mt), down $0.50/cwt. ($10/nt or $11/mt) from seven days ago.
In the domestic wire rod market, most transactions were reported this week at $45.50-46.50/cwt. ($910-930/nt or $1,003-1,025/mt), or an average of $46.00/cwt. ($920/nt or $1,014/mt), unchanged from seven days ago.
“The wire rod market remains strong and domestic mills are running pretty full,” said another long steel market insider. Unconfirmed reports indicate Liberty Steel’s financing package was approved last Friday, April 4, so the wire rod producer may have made the first step towards a reopening, the insider told SteelOrbis.
“The US steel market is currently happy, but the tariffs are making it hard for bigger decisions to be made among the US market as a whole,” the insider said.