Although details are scarce and nothing has officially been signed, the potential for a new NAFTA deal with Mexico has brought cautious optimism to the US import rebar market. The US’ close southern neighbor used to be a primary source of import rebar, along with Turkey, but steep AD/CVD duties issued a few years ago kicked them out of the market. Even when duties for two mills were revised downward to near-zero (0.56 percent for Deacero and 0.0 percent for Grupo Simec), monthly tonnage from Mexico never recovered to previous levels, but levels have been consistent so far this year, aside from a bump in April and May (census data recorded 14,925 mt and 10,439 mt, respectively) when the country was temporarily exempted from Section 232 tariffs.
A finalized trade deal with Mexico would alleviate much of the uncertainty currently plaguing the US rebar import market, but sources say it might not lead to a sharp decrease in Mexican rebar offers. Prices are likely to stay close to US domestic prices or at a “safe” margin below to reduce the threat of further AD/CVD actions. But even a slight reduction in offer prices will give Mexican producers an advantage over other foreign producers still subject to Section 232 duties.
Currently, Mexican rebar offers to the US are hovering around $40.00 cwt. ($881/mt or $800/nt) DDP Houston. Offers for US import rebar from Italy and Spain, meanwhile, are trending at $41.00-$42.00 cwt. ($904-$926/mt or $820-$840/nt) DDP loaded truck at US Gulf ports.