US import rebar and wire rod markets were mostly higher this week as overseas suppliers raised price expectations in reaction to newly announced Chinese market stimulus actions, which in combination with earlier US Federal Reserve interest rate cuts, are said to have caused steel futures prices to soar in Asian futures markets this week, and most global finished steel prices to rise in kind, market insiders told SteelOrbis this week.
The higher weekly pricing differs from the week of September 23, when US import markets were little changed given continuing low demand for US construction-related structural steel and plentiful domestic supply, market insiders said. Reduced mill discounting programs were also noted again this week, indicating a growing likelihood for higher finished steel prices as October and the new fourth quarter begins. Insiders said global scrap markets also remain in flux as uncertainty continues surrounding the effects the current US dockworker strike at US East Coast and Gulf Coast ports could have on US exported steel supply later in the fourth quarter.
“We’re seeing as much as a $30/nt ($33/mt or $1.50/cwt.) rise on import pricing for long steel because of the Asian market stimulus programs that were announced,” said one import rebar insider. “Still, many buyers are continuing to wait and see to purchase, because they want to see if the current higher market sentiment continues when Asian trading resumes after the Golden Week holiday ends on October 7.”
“The effect of the Asian markets stimulus could be nearly US$200 billion a year,” another import rebar insider told SteelOrbis. “China may announce another stimulus as well, in addition to another rate cut from the US Fed in November, so steel pricing is beginning to move higher on anticipation of more money flowing into previously-idled projects.”
On the US Gulf Coast, import rebar on a loaded truck basis is discussed at $36.50-37.00/cwt. ($730-740/nt or $805-816/mt) up from an average of $35.25/cwt. ($705/nt or $777/mt) seven days ago. Price increases on the US East Coast were less pronounced than those seen on the Gulf Coast as Hurricane Helene reduced deliveries there, insiders said. Average US East Coast rebar on a loaded truck basis is assessed at $35.50-36.25/cwt. ($710-725/nt or $783-799/mt), versus $35.25/cwt. a week earlier.
As domestic long steel prices rise, insiders say pricing for delivered long steel products from Mexico is becoming more competitive. Delivered-to-customer Mexican rebar vicinity Chicago is discussed at $36.15/cwt. ($723/nt or $797/mt), down from $36.78/cwt. (737/nt or $811/mt) one week ago. Domestic mill sales in the US Midwest are noted at an average of $36.75/cwt. ($735/nt or $810/mt), up $0.25/cwt. ($5/nt) on the week.
Short 2-60 day lead times for Mexican material also may increase Mexican mill competitiveness, insiders say, though competition from abroad may be stiff following the completion of the Golden Week holiday in China and the resumption of Asian trading on October 7.
“The strike at the ports is not expected to impact rebar or wire rod, since the main port that brings rebar into Texas is non-union,” said one Mexican rebar dealer. Lower exchange rates this week versus the week of September 23 also is spurring more competition from sellers south of the border, they say.
Market insiders said rebar imports from Egypt are discussed at $35.50-36.00/cwt. ($783-794/mt), though market insiders say suppliers in the country are reluctant to sell because suppliers want to wait until after the Golden Week holiday ends to see if the higher market sentiment continues once trading resumes. Rebar supplies from Algeria and Bulgaria were also reportedly not on offer, market insiders said, pending a continuation of recent higher market sentiment following the Chinese holiday.
Market insiders said low levels of imported wire rod and rebar were expected to continue through the end of 2024, as global pricing remains too high, shipping rates to the US remain prohibitive, and domestic mills “take every opportunity to capture import market share.”
On the wire rod front, imported material is discussed at $36.00-36.25/cwt. ($720-725/nt or $794-799/mt), up from $35.50-37.00/cwt. ($710-740/nt or $783-816/mt) reported seven days ago.
“Overall, imports of long products into the US from overseas are down between 20-25 percent from previous years,” said another import rebar insider. “In fact, we’re expecting rebar imports to be the lowest in nearly 10 years during the fourth quarter this year.”
“Domestic mills have made it hard to buy imports,” remarked another market insider. “That’s likely to continue until domestic pricing begins to increase and imported material makes sense from a price perspective.”