NEW YORK At least two
domestic mills have dropped net transaction prices for steel
bar products by $30 per tondouble the $15-per-ton
reduction previously announced by Gerdau Long Steel North
Nucor Steel Auburn Inc., a
division of Charlotte, N.C.-based Nucor Corp., announced in a
letter to customers Friday that it was cutting transaction
prices by $30 per ton for concrete reinforcing bar (rebar),
merchant bar and structural products.
"As always, we will monitor the
marketplace and will respond accordingly by making adjustments
to our base pricing in order to assure you of a competitively
priced product," the Nucor letter read.
The reduction in the mills
net transaction prices is the result of a $58-per-ton drop in
its raw materials surcharge paired with a $28-per-ton increase
in its base prices, the letter from the Auburn division
Fort Wayne, Ind.-based Steel
Dynamics Inc.s Roanoke Bar division also sent a letter to
customers Friday announcing a $30-a-ton drop on all products,
"Steel Dynamics Roanoke Bar
division reserves the right to be competitive in the
marketplace where necessary," the letter read. A source at the
company told AMM that falling scrap prices were the
primary driver behind the decline.
Nucor and SDI did not return
calls for comment, but AMM understands other Nucor and
SDI mills likely followed suit.
On Thursday, AMM
lowered its Chicago shredded automotive scrap priceused
as the basis for many mills surchargesby $58 per
ton after earlier indications had suggested the drop-off
wouldnt be so sharp (AMM, June 8).
In a leading move Wednesday,
Tampa-based Gerdau cut its tags by just $15 per ton
(AMM, June 7). A Gerdau spokesman declined to comment
Friday when asked whether the company might move to match its
competitors $30-per-ton drop.
"The reason behind the decrease
is simple: Everyone knew scrap was falling some $45 to $50 (per
ton). Gerdau sent out (the first) decrease to temper the
excitement and hoped that the market (wouldnt) fall
further," one rebar distributor said.
In addition to falling scrap
prices, the U.S. construction sectors summer slowdown
also may be behind the falling rebar prices, sources said.
Others said uncertainty in markets such as China and the
European Union also was to blame, since weakness overseas can
lead to increased imports.
At least two large foreign shipments of rebar are set to hit
U.S. shores this summer, traders said, noting that rebar
imports are then expected to fall off come September.