CHICAGO Nucor Corp. plans
to hold the line on transaction prices for concrete reinforcing
bars, merchant bars and structural products for a second
consecutive month, a move that will likely be followed by other
mills, market sources said.
The Charlotte, N.C.-based
steelmaker said in a letter to customers Thursday that its raw
material surcharge would stay the same in February. As a
result, "the net effect is that our transaction pricing ...
will remain unchanged," the company said.
The steelmaker had lowered its
January scrap surcharge by $1 per ton while increasing its base
prices by the same amount, resulting in no net change to
transaction prices this month vs. December (
amm.com, Dec. 11).
AMM had not seen
February pricing letters from other mills as of Friday
afternoon, but not all domestic mills make written
announcements when prices remain steady.
Following Nucors leading
move, buyer sources generally said they expect prices across
the market to remain unchanged next month, given a sideways
scrap market and slower wintertime demand. As such,
AMMs Grade 60, No. 5 rebar price has also held
unchanged at $680 per ton ($34 per hundredweight) f.o.b.
"January is historically our
slowest sales month, and it is following that trend," one
Midwest fabricator said of the flat pricing. "But I have
fabrication orders. Weve got stuff going to West
Virginia, Pennsylvania and New Jersey, and were expecting
growth of 20 percent this year."
Most sources agreed that demand,
while slow in most areas, will pick up in 2013, especially
given that distractions about the "fiscal cliff" are no longer
weighing on the market, at least for the time being. But others
said it was too early to make any overly optimistic predictions
until February or March, when it should become clearer whether
the construction marketthe major end-use sector for
rebaris indeed recovering and, if so, at what pace.
Some buyers said they had
expected U.S. rebar mills to drop tags slightly, with some
citing an anticipated influx of rebar, mostly from Turkey, to
ports in Houston and New Orleans in coming weeks.
"(Overseas rebar suppliers) are
looking to bring material into the U.S. because the European
market is terrible, and theyve got to keep their mills
going," one procurement manager said.
U.S. rebar imports stood at
47,140 tonnes in December, according to license data from the
U.S. Commerce Departments Import Administration division.
The country is on course to import at least 70,189 tonnes of
rebar in January, according to license data calculated through
Jan. 11. Turkey has been the top overseas supplier of rebar to
the U.S. market during the past year, and by a big margin.
Some sources said they expect as
much as 200,000 tons of rebar to arrive in January and
February, while others said those estimates are overblown.
"Its not a surprise that
scrap went sideways. It is a surprise that the mills
didnt drop (the price) a little bit with it being winter
and (construction activity being) weak," one distributor said.
"I thought (domestic mills) might send a warning sign (to
importers) and knock (prices) down."
But one upshot of the flat pricing is that buyers who had
been expecting a drop have been more likely to place orders,
the distributor said. "Im busy and doing well,
surprisingly," he said. "Things are getting better. Its
not like they were five years ago. But Im getting my fair