Even though shredded scrap prices have not quite settled for June, US rebar mills have already indicated a downtrend for domestic rebar prices. Gerdau Long Steel North America announced Wednesday a $0.75 cwt. ($17/mt or $15/nt) decrease in transaction prices for rebar, effective immediately--a surprising move considering shredded scrap is expected to drop by $40-$50/lt. Prior to Gerdau's announcement, sources told SteelOrbis that US mills would probably decrease rebar prices by the full scrap amount, believing that they could not justify a "halfway" move in this lackluster demand environment. But now sources expect Nucor--which is usually the frontrunner in terms of monthly price announcements--to only lower rebar prices by $1.00 cwt. ($22/mt or $20/nt), or possibly $1.50 cwt. ($33/mt or $30/nt). Either way, Gerdau will have to follow Nucor's move, which means spot prices will drop down to a minimum of $34.25-$35.25 cwt. ($755-$777/mt or $685-$705/nt) ex-mill by next week.
As for imports, the Turkish rebar market has had to contend with its own scrap downtrend, and offer prices are now in the range of $30.50-$31.50 cwt. ($672-$694/mt or $610-$630/nt) DDP loaded truck in US Gulf ports--a decrease of $1.50 cwt. since last week. Mexican rebar offers, meanwhile, are expected to mirror the US domestic price move and decrease by at least $1.00 cwt. within the next week. However, traders report that some offers have already been heard at $30.50 cwt. DDP loaded truck delivered to US border states on the low end, reflecting a drop of $1.25 cwt. ($28/mt or $25/nt) in the last week.