In response to relatively lackluster demand for imported rebar in the US, import sources have lowered their offers to the US in an attempt to garner orders, as well as remain competitive with downtrending US domestic rebar prices. Offers from Turkey, where the domestic market is struggling to lift up prices, have dropped $1.00 cwt. ($22/mt or $20/nt) in the last week to $31.00-$32.00 cwt. ($683-$705/mt or $620-$640/nt) DDP loaded truck in US Gulf ports. Mexican rebar offers, meanwhile, have decreased even more drastically--the new offer price range of $30.50-$31.50 cwt. ($672-$694/mt or $610-630/nt) DDP loaded truck delivered to US border states reflects a $1.50 cwt. ($33/mt or $30/nt) decline from last week, as traders report Mexican mills are eager to keep import volumes to the US high. According to US import data, the US imported 28,413 mt of rebar from Mexico in September (license data), following 30,149 mt in August (preliminary census data)--both figures represent the highest monthly tonnage levels in over a year.
While there is still a wide margin between rebar import offer prices and the current US domestic spot price range of $33.75-$34.75 cwt. ($744-$766/mt or $675-$695/nt) ex-mill, it could narrow significantly in the next week or so after scrap prices settle. An expected $40-$50/long ton drop in shredded scrap would certainly result in a rebar transaction price decrease, but by how much is still up for debate. Some sources tell SteelOrbis that after last month's halfway move by US rebar mills (they only dropped transaction prices by roughly half of the RMS decrease), mills will be under pressure to follow the October scrap decrease dollar-for-dollar. But others say that with an almost inevitable scrap uptrend right around the corner (as is typical in Q4), mills might hedge their bets and once again announce only a moderate decrease.