November closes a choppy month in the rebar market. The month started with a price increase announcement to begin the month of $30/ton. It was followed by most mills in most regions, but not all. This caused some confusion in the market throughout the month. By the end of the month, the market seemed to ultimately reject the increase, and most market participants feel we currently sit where we started. The market seems to have found footing with the recent election, low import availability and tight domestic supply. At the same time, adequate supply, slowing seasonal demand and concerns over inviting imports with a higher domestic price was enough to thwart the increase. For the time being the pricing may not have increased in the rebar market but very few are talking of lower pricing either to end the month.
On the domestic side, inventory remains tight at the mills, with manufacturers opting to continue to be very conservative on what is produced, relative to what is ordered. Domestic mills are enjoying strong demand as buyers continue to shift their needs from import to domestic product. The increase calls have caused mills to run low on many sizes in many regions especially for this time of year. Domestic mills still have ample capacity to keep up with demand at this point on upcoming rollings, especially heading into the year end, but the strength in orders is a welcome change from the past several months.
On the import front, bookings continue to remain difficult. The failed price hike in November did little to sway buyers to load up on import for next season. In addition, the incoming administration has threatened increased tariffs which could affect import supply by creating potential tariff costs for importers of record. Bottom line, would be import buyers still struggle to find value in the import offers when weighing the pricing and the risk involved with bringing product in. Expect this trend to continue moving forward into the new year.
On the raw materials front, scrap looks again sideways. While traditionally there is upward pressure on pricing in the winter due to lack of collections, that pressure seems to be off set currently by a global decline in pricing. Last month saw traditional export scrap markets soften which gives US scrap dealers less options to deliver their scrap supply. They are forced to negotiate only with domestic mills giving the mills the upper hand. The most likely scenario to close November is another month of sideways trade for December holding off potential increases until beginning 2025. The final number will likely come out late next week at which time we will update.
Lastly and most importantly this week, we at Adelphia Metals would like to wish you and yours a safe, happy and healthy Thanksgiving Holiday!!