US import rebar and wire rod prices were mostly steady to higher this week even as US domestic steel mills continue to dominate the majority of new business transactions, steel market insiders told SteelOrbis this week.
Long steel market insiders note that spot trade in imports remains limited because the spread between imports and domestic pricing is too narrow to justify the added risk, they said, adding that recent rising freight rates and stubbornly high international scrap pricing has added to the cost and risk of the import option. A growing consensus about a soft-sideways-to-lower US domestic scrap pricing outlook for July and anticipated mill discounting following the US Fourth of July holiday also is limiting import activity, they said.
“There’s very little to no incentive to buy import rebar versus domestic rebar right now,” remarked one SteelOrbis market insider. “The spread between the two prices is too close. Import rebar has basically been $36.00-$37.50/cwt. ($794-$827/mt or $720-$750/nt) [on a delivered basis] since mid-May. We need at least a $50/nt ($55/mt) spread to market the transaction work.”
On the supply side, US scrap dealers report US domestic scrap for July is expected to settle nearer to the second Tuesday of the month this go-round, on Tuesday, July 9, especially since the Fourth of July holiday falls toward the end of next week. The consensus as of report writing is for a soft-sideways to $10-$20/gt ($10-$20/mt) lower July value versus June, across all grades except primes, they said. Market insiders caution that continued declines in domestic scrap pricing could begin to limit inflows into yards, especially given recent heat waves through the US Northeast and Midwest.
In the long steel markets, import rebar on the US Gulf Coast is discussed unchanged on a loaded truck basis at $36.50/cwt. ($805/mt or $730/nt). US East Coast loaded truck import rebar was unchanged at $37/cwt. ($816/mt or $740/nt), market insiders told SteelOrbis.
“The price of international scrap for export is not going down,” the market insider added about current import rebar pricing. “With scrap so high, exporters cannot lower the cost of rebar very much, so from a pricing standpoint, the markets are showing very little difference from last week.”
Import rebar pricing from Egypt is quoted “on the higher side ” though unchanged on the week at $37.00/cwt. ($816/mt or $740/nt), delivered US port, while Bulgarian exports to US ports are quoted ($8.00/mt or $7.50/nt) higher on a delivered basis at $36.00-$36.75/cwt., ($794-$810/mt or $720-$735/nt), market insiders said.
Contacts report a 20,000-ton July rebar cargo from Bulgaria for August delivery traded at $36.75/cwt ($810/mt or $735/nt) since the June 3 Biden Administration extension of the exemption of Ukraine from the Section 232 tariffs on steel products. The exemption, in effect, allows tariff-free steel billets from Ukraine to be sent to Poland or other EU countries to be turned into rebar, wire rod and mesh products for potential export to the US and abroad.
North African rebar from Algeria on a delivered basis is discussed unchanged once again at $36.50/cwt. ($805/mt or $730/nt), market insiders said.
To the south, imported rebar from Mexico on a loaded truck Houston basis is discussed unchanged at $37/cwt. ($816/mt or $740/nt). Mexican market insiders continue to point to the devaluation of the peso as “helping” Mexican export prices compete with US domestic rebar values. As the peso continues to devalue versus the US dollar, they said, July rebar, could land in Houston on a loaded truck basis at $36.25/cwt. ($799/mt or $725/nt).
In the imported wire rod markets, imports from Ukraine are last discussed slightly lower at $35-$35.50/cwt ($772-$783/mt or $700-$710/nt), on a delivered to customer basis, versus $35-$36/cwt. ($772-$794/mt or $700-$720/nt), seven days ago. Lead times for the transit to the US are last quoted at 6-8 weeks.
Market insiders said higher freight rates and solid international scrap pricing was causing the delivered price of DDP loaded truck imported wire rod mesh to rise on a week-to-week basis. The current price range quoted to SteelOrbis is $37.00-$38.00/cwt. ($816-$838/mt or $740-$760/nt), up $0.50/cwt. ($11/mt or $10/nt) from this past week’s $36.50-$37.50/cwt. ($805-$827/mt or $730-$750/nt) range. Domestic market insiders continue to say that local wire rod mesh, even at $39/cwt. ($860/mt or $780/nt) is a better value, considering the added risk and time requirement involved in executing import transactions.
In other long steel grades, Merchant Bar Quality (MBQ) for July delivery is last offered US Gulf Coast FOB port basis unchanged at $47/cwt. ($1,036/mt or $940/nt), while US East Coast offerings are heard steady at $51.00/cwt. ($1,124/mt or $1,020/nt) FOB port. Market insiders said the current July MBQ offerings are about $20/nt ($22/mt) less than pricing heard in March of this year.
Import W-Beams for delivery from the UAE and Europe are discussed steady on the week at $49/cwt. ($1,080/mt or $980/nt) FOB port US, while Mexican import angles are discussed on a loaded truck basis Houston unchanged at $48/cwt. ($1,058/mt or $960/nt), import market insiders said.