US rebar imports decline in October as stocks at ports tighten

Highlights

Imports still offered below domestic

Shredded prices increase by $20/st for December

US imports for consumption of concrete reinforcing bars totaled 86,757 mt in October, down 19.7% from September, according to the most recent US Census data.

Imports are expected to remain limited until the end of the year, but supply at the ports has started to tighten recently as activity has picked up, according to traders.

With the news of mills increasing their scrap bids for December, activity at the ports, especially Houston and Florida, improved as importers held prices steady and buyers tried to get ahead of any possible increases to come.

Any buying in Texas would have to be for meeting current demand as there are inventory taxes come year-end.

Some traders have heard that material is now sold out through January at one of the major Mexican producers as domestic demand there has improved.

Market participants are still expecting import arrivals to remain limited through January as many were passing on future offers regardless of price.

Some foreign mills have faced increased energy costs and scrap prices as they started to restock raw materials.

Some domestic long-product mills see inventories drawing for December but suggested prices could fall slightly with production steady.

The top three countries the US imported from were Mexico, with 27,889 mt; Turkey, with 16,514 mt; and Canada, with 10,089 mt.

Imports from Turkey were seen mainly in Philadelphia and San Juan, Puerto Rico.

Imports from Algeria totaled 8,783 mt during the month and were mainly seen in Boston.

From January through October, US imports totaled nearly 1.195 million mt, up 16.41% year on year.

Philadelphia saw the majority of imports, with 19,097 mt landing in the region during the month, followed by Houston, at 13,785 mt, and Laredo, Texas, with 11,007 mt coming in.

Traders and buyers in Houston and Florida have seen stocks at the ports rise drawing over the past month but especially during this week as prices have fallen $215/st in the South from the high last seen June 24. Domestic prices in Florida have fallen by $130 since the end of August.

Spot offers at the ports in Houston and Tampa have moved down to the $890/st, loaded truck, as domestic mill offers in Texas were last heard offered at the $955-$995/st level, depending on mill location and in Florida offers were seen around the $870/st level and down to the $830-$840/st level for large tonnage purchases.

No new future arrival offers were heard as Platts DDP Houston was last assessed at $840/st just below recent offers from Algeria and Turkey ranging from $850-$860/st as buyers passed despite lower prices because of uncertainties going into the new year and were thus not willing to increase inventories.

Offers from Vietnam were previously heard around the $810-$820/st level as those tonnages are expected to arrive in Philadelphia.

According to data from Panjiva, the trade analysis unit of S&P Global Market Intelligence, for November through Dec. 4, no larger arrivals were seen with only 4,542 mt seen entering Houston from Turkey and most recently 1,371 mt and 1,372 mt from Turkey both hitting New Orleans.

Recently a shipment of around 25,000 mt was heard landing in Port Everglades, Florida, according to market participants.

Some buyers were still focused on inventories as they were still unsure of the demand picture for the first half of 2023 while others expect strong demand from infrastructure bills, especially starting in the second quarter.

Rebar mill margins are still around 65% higher, depending on region, than they were the last time shredded scrap prices were at these levels in late December 2020, although other input costs have risen significantly in that time and buyers felt prices won’t fall to pre-pandemic levels despite where scrap prices fall.

Platts last assessed US Southeast rebar at $940-$950/st Dec. 9, with US Midwest rebar also at $940-$950/st, also unchanged, according to S&P Global Commodity Insights.

All prices are on an ex-works basis.