NEW YORK Reinforcing bar
demand remains spotty nationwide, with some regions seeing a
flurry of activity and others reportedly thirsty for work.
"There are pockets of activity
but there are pockets of desperation," one rebar fabricator in
U.S. demand for rebar has been
erratic and highly variable based on region, with areas of the
Northeast and the Mid-Atlantic fighting for orders, and Texas
and some West Coast states riding a wave of activity, according
to both buyer and seller sources.
Sources reported poor order
backlogs in states like Maine, Pennsylvania and Ohio, and
higher levels of activity in the Dakotas, Nebraska, Texas and
One source attributed some
activity to construction associated with natural gas
exploration, which has led to increased building projects that
require rebar in areas with natural gas drilling.
"I had to send out four loads
because of the oil pocket down in Texas. Theyre putting
up apartment buildings (to house the energy workers). ... There
are pockets of really good stuff," a rebar distributor said.
"Certain pockets are just like gangbusters. It just
However, that selective strength
hasnt been enough to keep a floor under rebar prices,
which have fallen $20 per ton ($1 per hundredweight) after
major mills announced cuts at the start of the month, led by
Gerdau Steel Long America (
amm.com, May 1). The price drop came several days
before AMM settled its consumer buying price for
shredded automotive scrap, the basis for some mills raw
material surchargesan unusual move that some sources said
appeared to be an attempt on the part of the mills to change
prices independently of scrap tags (
amm.com, May 3).
Buyers said they have taken
advantage of the full $20-per-ton drop, with sources pegging
rebar transaction prices at around $650 per ton ($32.50 per
hundredweight) f.o.b. mill this past week, down from $670 per
ton ($33.50 per cwt) two weeks ago.
"The $20 (cut) kicked in and
its sticking for sure," a West Coast rebar fabricator
said. "The mills all kind of said they dont want prices
to go much below this."
But while some buyers said they
bought at the lower numbers, with uncertainty about scrap
volatility and continued patchy demand, most buyers are
hesitant to hold any inventory and have generally been buying
no more than they need.
"Theyre all sitting on the
fence," a mill source said of his customers. "If they need
material, theyre buying. I think everybodys just
kind of waiting and seeing."