Import rebar offers for the US have decreased by approximately $0.50 cwt. ($11 /mt or $10 /nt) in the last week as pricing in key international rebar markets continues to trend down.
Most import rebar offers on the market now range from $30.50 cwt. to $31.50 cwt. ($672 /mt to $694 /mt or $610 /nt to $630 /nt) FOB loaded truck, in US Gulf ports.
In the past week, Turkish rebar mills have considerably lowered their offering prices for the US. Political turmoil has put the brakes on new construction projects in Turkey, negatively affecting rebar prices in their domestic market. Furthermore, the prime Turkish export market, the Persian Gulf, is receiving some rebar shipments from China, and so the Turkish mills have had fewer orders than usual coming from Dubai.
The Asian rebar market as a whole is currently stronger than the Turkish rebar market, but offering prices from certain counties, such as Japan and Malaysia, have started to soften as well. However, the second largest rebar exporter to the US, Taiwan, is able to keep their rebar export prices more stable with billet and scrap prices on the rise in that market.
There is still very little import rebar on the ground and at rebar terminals in US ports. However, US customers are not running out of rebar yet and are in no hurry to place new orders, especially since prices are still trending down. Nucor's decision to keep rebar pricing stable during the month of June obviously wasn't enough of an impetus to jump-start ordering activity significantly.
Data from the US Import Administration show that Turkey and Southeast Asia are still the major import rebar sources for the US. During the first four months of 2007, the top US import rebar sources were: Turkey at approximately 152,000 mt, Taiwan at 94,200 mt, Mexico at 87,900 mt, Brazil at 66,100 mt, and Malaysia at 54,400 mt. Japan is another main import rebar source for the US, shipping 52,900 mt to the US during this period. The data also show that in April 2007 total rebar imports to the US declined drastically to a total of 99,263 mt, compared to 199,136 mt in March 2007, and compared to the March 2006 total of 266,700 mt.
As for the domestic rebar market, scrap prices may have stabilized for the time being and, therefore, there is a good chance that Nucor will choose to keep rebar pricing stable in July. However, rebar demand has not strengthened much, and most domestic mills are still looking for orders and coming up with last minute deals. Therefore, there is a slight chance that Nucor and other domestic mills will lower rebar prices in July, based on the lackluster demand. The pricing trend is still slightly down.
For now and throughout the month of June, most domestic offers on the market will continue to range from $31.90 cwt. to $32.40 cwt. ($703 /mt to $714 /mt or $638 /nt to $648 /nt) FOB mill.