US mills are having success with a rebar price increase that was implemented on short notice due to low inventory levels and no import offers.

 

Nucor Corp., Charlotte, N.C., announced last week it was raising all prices for concrete reinforcing bar by $20 per ton ($1 per hundredweight) effective with Oct. 1 shipments.

 

Larger-sized material in 20-foot lengths increased immediately by $10 per ton (50 cents per cwt), with the $20-per-ton increase tacked on when October starts resulting in an overall $30-per-ton increase.

 

Following Nucor’s announcement, Gerdau Long Steel North America and Steel Dynamics Inc. made similar pricing moves.

 

"The $10 increase is sticking and they have a fair shot at making the $20 stick," an eastern distributor said.

 

Imports are scarce at the moment. "There are no imports in our neck of the woods. Turkish rebar is usually a factor but there is none," the eastern stockist added.

 

Rebar imports peaked in April at 85,931 tonnes and there were import licence applications for 47,036 tonnes in July, according to the most recent U.S. Commerce Department data.

 

A southern broker said that imports are overpriced and not worth the gamble. "I just got a quote for $37.25 cwt delivered in St. Louis (Mo.) in November. I can’t take a risk like that 60 days out," he said.

 

The supply of rebar is limited. "I am making deals and then I try to get the stock and am finding there is not much out there to fill the orders," the southern broker said. "I can’t find Grade 40 in No. 3 or No. 4. I am sure people are sitting on it but I can’t find it."

 

Discipline by the mills has ratcheted down the supply. "The mills have been rolling limited tons, so there is nothing to buy from the floor unless you placed an order," a Midwest source said. Prices have been stagnant since the end of July and mills are motivated to make sure the increase takes hold, he added.

 

With supplies so low, the mills have the upper hand at the moment, according to all sources. "They are holding all the cards and know they have a complete dictatorship on my prices. Don’t be surprised if you see yet another increase after Oct. 1. There is nothing to stop them," the southern broker said.

 

The southern broker also said that demand has been mediocre at best, a sentiment the eastern stockist shared. "As for demand, it is hit and miss, and the competition is very tight right now," the eastern stockist said. "There is no stability in the pace in which the orders are coming in and I expect it to stay that way until the economy starts to show some kind of growth."