Although US domestic rebar spot prices have not changed in the last week, the stability could be short lived.
As confidence in a strong spring construction season continues to slip (sources say activity will be livelier than 2010, but not a surge as many expected months ago), and the possibility that scrap pricing will stay neutral next month gains traction, domestic rebar mills are holding on tight to current spot prices, which finally firmed up to official asking prices as of last week. Sources tell SteelOrbis there is not much room to negotiate with prices in the range of $36.00-$37.00 cwt. ($794-$816/mt or $720-$740/nt) ex-mill because mills expect a downtrend soon, and they would prefer that prices come down from a relatively high point. Nevertheless, SteelOrbis has also heard that certain mills are willing to dip beneath the $36.00 cwt. level if they are eager enough to book tonnage.
Across the border, Mexican mills bumped up rebar prices in the last week after deciding their offer levels were too low--their margins were razor thin and they wanted to lift prices closer to US levels. New price levels are in the range of $33.50-$34.50 cwt. ($739-$761/mt or $670-$690/nt) duty paid FOB delivered to US border states, which is a $1.50 cwt. ($33/mt or $30/nt) increase on the low end and a $0.50 cwt. ($11/mt or $10/nt) increase on the high end. However, US buyers are remaining relatively cautious with their purchases, so it remains to be seen if the Mexican price correction was too much, or just enough to continue gaining orders.
Rebar orders from overseas, on the other hand, are still quiet, with not many US buyers interested in receiving material so far into the future during the current atmosphere of uncertainty. Turkish offers in the range of $34.50-$35.50 cwt. ($761-$782/mt or $690-$710/nt) duty paid FOB loaded truck in US Gulf ports have not changed in the last week, even though the local Turkish rebar market seems to experiencing a slight uptrend.
