Friday night, a major rebar manufacturer announced a $30/ton increase. Other mills have wasted little time to follow that move with increases of their own. The move was undoubtedly a reaction to continued tight supply and not being able to keep up with customer demand. Despite a slower upcoming seasonal demand and sideways scrap pricing in November, mills feel the market is strong enough to support the increase. Currently, there is not a lot of competition to suggest otherwise. The increase affects all new orders.
We will continue to keep you posted on market developments.
Scrap settled this month sideways at $370/ton (Chicago Shredded Index). This is unchanged from the previous month and was widely expected. The non-change will do little to impact pricing changes with the domestic mills. The market sentiment continues to be dominated by supply issues with raw material cost taking a backseat.
We will continue to keep you posted with events in the market.
Like the holiday being celebrated today… The rebar market is experiencing its share of spooky supply situations. Tight supply continues to be the discussion as October draws to a close. For the past several months, mills have failed to close the gap in supplying all the rebar that the market is currently demanding. The worst markets with the tightest supply are the Northeast, Midwest, and Southern markets. The Southeast and Florida are also very tight and not far behind. While the West is still tight, it does not have the same degree of supply concerns as the rest of the country. Relief is in sight, however, as we roll the calendar forward to November. November typically begins a period of slowdown in demand to close the year. The Thanksgiving holiday week, coupled with seasonal weather trends in a lot of the country, typically cuts demand at the end of the year and should allow mills to catch up. Not surprisingly, mills that are sold out in November will currently accept orders for December.
Import has also started to gain traction this month. The pricing on import does not represent a value to current domestic pricing as much as it does “guaranteed supply,” which has become more desirable to buyers who have been limited in what they can buy domestically in the last couple of months and cycles. Buyers still are cautious on the import, as buys today would not arrive until February & March, and with no value on the price, if the supply picture does improve domestically, as expected, stockists may find themselves competing at the same price level with a lesser-desired import to a more valuable domestic product. As such, import is expected to be basically nonexistent through the balance of the year; however, a couple of cargos have been rumored to be booked to start 2026.
Scrap has trended sideways through the month after falling $10/ton last month. No real change is expected for this month. Given the tight supply, producers have been able to keep the modest reduction in their pocket. Looking forward, with limited demand in most other steel products besides rebar, the raw materials market is expected to remain at bay for the foreseeable future. Final numbers will post next week, and we will update accordingly.
Have a safe and happy Halloween and a “spooktacular” weekend ahead!
October shredded scrap posted final this afternoon at $370/ton, down $10/ton from September. The downward move was the first change in scrap after 5 straight months of no change. Despite rebar demand being incredibly tight, the softness in scrap reflects the overall larger sentiment in the steel market, with very lackluster demand currently in most steel products that represent a larger portion of the steel market than rebar. It is very unlikely that rebar mills will concede anything in pricing related to the softer scrap, as short supply still dominates the headlines in the rebar market. Rather, they are more likely to hold the line on pricing and benefit through stable pricing and lower input costs. We will continue to monitor and report any changes that may affect the market.
Comments Off on September Month End Rebar Comments
Tight inventory supply and longer than expected lead times are dominating the news in the rebar market to close the month of September. Conditions failed to improve during the month as several mills throughout the country experienced a wide variety of issues that curtailed their supply and pushed back their rollings. Buyers were left scrambling to cover their needs, and that only added to the appearance of strong demand throughout the month, despite little evidence that YOY, more rebar is moving through the system to close the summer. As we head into the month of October, things are expected to remain tight in the month ahead with mills completely sold out, upstart mills failing to deliver meaningful tons, and very little import in the pipeline.
Domestic mills across the country continue to struggle to supply the market with the bar it is demanding. The import squeeze levied from the increased tariffs in June was expected to be more than offset by new capacity coming online in the 3rd quarter. However, as we enter the 4th quarter, none of the 3 new mills have been able to bring about meaningful tons to the market yet. To compound matters, the current domestic capacity has struggled heavily in many mills in the 3rd quarter to maintain even their scheduled rollings. Both factors have created a tightness in supply that the market has not seen since covid. Most agree it will be limited, as the new mills will likely gain their footing in the months to come, and demand will slow with the seasonal trend in the year. Still, the outlook from October into November remains solid.
On the scrap side, other steel markets (besides rebar) continue to drag down the demand for raw materials. While the demand from the rebar mills may be solid, scrap dealers are at the mercy of other, larger market segments that have slowed throughout the 3rd quarter heading into the 4th quarter. Without strong demand from the entire steel sector, most expect the scrap market will retreat somewhat this month after a long period of stability. The scrap is expected to post next week, and we will advise accordingly. A softening scrap market, as well as the increasing supply outlook for rebar and a seasonal slowdown in rebar demand, has mills pausing on pushing the rebar price higher as of now.
On the import front, very few offers are heard in the market. Trade cases filed against Vietnam, Bulgaria, Egypt, and Algeria have kept the traditional import sources at bay. The additional 25% tariffs levied in June have limited other origins from being able to compete in the US market. With mills holding their current pricing, there will be very little opportunity for foreign mills to compete in the US market unless something changes.
We will continue to monitor events in the market and will keep you posted. Have a great start to the final quarter of 2025.
Yesterday, Chicago Shredded scrap posted a final price of $380/ton, unchanged from the previous 4 months. The 5-month streak is the most consistent streak in over a decade for the shredded scrap market, providing little additional incentive for mills to try and push pricing higher. The increases from June and July have been almost exclusively based on a tight supply of rebar and not increasing costs of production. The early forecast for the months ahead points to scrap moving sideways to potentially down based on declining demand from other steel products that are manufactured from shred driving down the demand for shred and the price with it.
We will continue to update you with developments in the rebar market. Have a great rest of your week!
