NEW YORK Nucor Corp. reported an 11.1-percent decline in its fabricated rebar shipments in the third quarter, citing import pressure and a depressed nonresidential construction market.
It was the fourth consecutive quarter that Charlotte, N.C.-based Nucors shipments of the product have dropped compared with the corresponding period the previous year. The company shipped 305,000 tons of fabricated rebar in the quarter ended Sept. 28 compared with 343,000 tons in the same quarter last year.
"The imports of rebar over the last quarter have been a major issue for our company and for our country. ... And that has impacted our business on the rebar side also," chief executive officer John Ferriola said in an Oct. 17 earnings conference call with investors.
"We have instructed our distributor to stop importing these products," executive vice president James Darsey said at an International Trade Commission (ITC) hearing Sept. 25. "These import volumes have pushed to other U.S. customers."
A rebar buyer outside the company said the rule was instituted in late 2012, which coincides with Nucors drop in fabricated rebar shipments.
"As of December, Nucor couldnt buy from the Turks, they couldnt buy from Deacero (SA de CV)," the rebar buyer said. "Has that made them less cost competitive? Probably."
Nucors fabricated rebar shipments totaled 280,000 tonnes in the second quarter, a 13-percent decrease compared with the same period last year, and totaled 228,000 tonnes in the first quarter, down 8.8 percent year over year.
Domestic rebar producers have long cited import pressure from Turkey and Mexico as a primary source of competition, and Nucor was one of five companies that filed a petition to investigate rebar imports from the two countries (amm.com, Sept. 4). Ferriola reiterated Nucors determination to enforce trade laws.
"Evidenced by our participation in last months trade case filed against rebar imports from Turkey and Mexico, Nucor stands ready to pursue appropriate legal action when our industry is harmed by violations of U.S. and international trade laws," he said, adding the trade petition hasnt yet significantly impacted import flows.
"I dont think weve noticed a major change in the buying habits of the customers," he said. "Obviously, whenever we begin trade action, the countries that are importing the product get nervous. We see a slight reduction in the amount of imports coming in. But other than that, theres been no major change in the buying habits."
The company also attributed its drop in rebar shipments to non-residential construction weakness in the United States.
Poor weather conditions in the first two quarters drifted into the third quarter as well, inhibiting construction and depressing orders.