NEW YORK The Independent Steel Alliance (ISA), a rebar
buying co-op composed of independent fabricators, is aiming to
recruit at least one of the top three domestic rebar producers
as it increases its shipment volumes and adds members.
Our goal is to have a relationship with at least one of
the big three but not all of them, ISA executive director
Chris Casey told AMM
. The three largest domestic rebar
producers are Nucor Corp., Gerdau Long Steel North America and
Commercial Metals Co.
Members of the co-op, which leverages significant tonnage
purchases from affiliated suppliers in order to obtain a
rebate, have bought thousands of tons of rebar since the
ISAs formation at the beginning of the year. The group
has recruited big-name producers, including Steel Dynamics Inc.
and Monterrey, Mexico-based Deacero SA de CV.
We were approached by them and we evaluated the
membership and we felt that we could attain our long-term
strategic objectives without joining the ISA, a spokesman
for Gerdau said.
Nucor and CMC declined to comment.
Several supplier sources told AMM
they had seen
increased business from members since the co-op was formed.
ISA members make an initial financial investment and then are
rewarded with a rebate for buying tonnages from ISA suppliers.
Some members will generate a positive return on their initial
investment this year, Casey said.
ISA fabricator members bought 780,000 tons of rebar over the
last year, Casey said, representing about 10 percent of
domestic rebar consumption. Nucor supplied 32 percent of
members purchases, Gerdau supplied 30 percent and CMC
supplied 7 percent, according to Casey, adding that independent
fabricators account for about 47 percent of domestic rebar
Members have changed their purchasing patterns to target ISA
suppliers in order to achieve a rebate, suppliers and buyers
told AMM, with rebar producers saying as early as March that
they had received additional business (
amm.com, March 1
Casey said that only one of the largest domestic rebar
producers could join the group if it were to function
Whoever gets on board first will have the greatest
opportunity to win and not get left behind, Casey said.
The sooner, the better.