Month End Rebar Notes
As August draws to a close, the dominant storyline in the rebar market remains a stubborn tight supply situation. Domestic mills were expected to catch up during August, and new capacity was expected to be realized during the month. Neither seemed to happen, and the result was holes in several inventory items and expanding lead times. Heading into September, with the June and July price increases fully in play and the new capacity that much more likely to appear now in September, the question remains: when will the mills catch up and the supply picture improve? Each region varies in its supply picture, but most expect the improvement that was expected in August to now be realized in the month of September.
Domestic mills are tight across the US, with the Midwest and East being the most extreme. The South and West are modestly better but still tight on supply. Mills have very little to no inventory on hand and are forcing buyers to book ahead on rollings to cover their needs. With a price tag that is the highest of the year, heading into the fall season, there is uncertainty about how full the September/October bookings will be at the various mills. In addition, new mills will be accepting orders, which might also curb the volume of new orders. Still, mills report ample demand, and with the lack of supply, rumors swirl about potential further increases despite no pressure from the raw materials front.
Scrap remains very quiet, with most expecting little to no change for September. While the rebar market is strong, several other steel markets have shown signs of weakness, and overall demand for scrap remains stagnant. A strong demand from rebar mills is not enough to pull the shredded scrap pricing from its recent levels. If Scrap is to make a move, most agree it would be a decrease, if anything. Scrap is expected to report late next week or even the following, and we will update accordingly.
On the import front, new offers still remain few and far between, with limited sources available to even offer. Some traders have dipped their toes in with new offers from mills that are not under anti-dumping review for late Q4 and early next year, but after absorbing the full 50% tariffs, those offers garner little attention. The only reason to entertain them would be fear of limited supply, but most expect the supply situation to improve as winter approaches and new capacity comes online. The result is very few bookings in the last 30 days and very low import volumes to close 2025. That could undoubtedly change if mills tried to push higher prices through and give foreign mills more room to negotiate. Domestic mills are very aware.
We will continue to keep you posted as we navigate through the month ahead. In the meantime, please have a safe, happy, and healthy Labor Day holiday weekend!
