Global rebar prices rose by 0–6% m/m in May

In May, global rebar prices rose across all key markets by between 0% and 6% month-on-month. Turkey saw the weakest performance, with the average price there rising by just 0.1%. The largest increase was recorded in Italy, at 6% month-on-month.

Turkey

In May, the Turkish rebar market remained largely stable. Throughout the month, prices held steady at $597.5/t FOB, and it was only at the start of June that offers were adjusted to $596.43/t FOB. This represents a 0.2% decrease for the period from 1 May to 5 June. At the same time, the average price for May of $597.5/t was 0.1% higher than in April ($596.8/t).

The main factor behind this stability remained the balance between weak demand and high production costs. Turkish mills sought to keep export offers within the $595–610/t FOB range. At the same time, buyers in most markets were putting pressure on prices and targeting levels no higher than $595/t, and in some cases below $590/t. Demand from the EU remained limited due to uncertainty over quotas and the CBAM, whilst trading in the Balkans was tough. Additional pressure came from competition among Turkish producers themselves and cheaper offers from Algeria, India and China.

The domestic market also failed to support price growth. Ahead of the long Muslim holidays, traders and processors increased discounts to attract liquidity, but the market did not see the expected recovery after the holiday period. At the same time, high prices for scrap, energy and raw materials prevented mills from significantly lowering their quotations without losing margins.

In the short term, the market will remain under pressure. If demand does not recover and scrap continues to fall in price, Turkish producers may make moderate concessions. At the same time, a sharp decline is unlikely due to limited production profitability.

EU

The situation on the EU market was relatively better. In May, average rebar prices in Italy rose by 6% month-on-month to €698/t ex-works, whilst in Northern Europe they rose by 5.1% month-on-month to €704/t ex-works. Towards the end of the month, the market weakened slightly, causing offers in Northern Europe to fall by 0.7% to €700/t between 1 May and 5 June. In Italy, however, prices remained 5.2% higher at €710/t.

The price rise in May was primarily driven by a coordinated stance among European producers. Following previous increases, they were in no hurry to make concessions, citing high energy costs and the need to maintain margins. In Italy, mills sought to consolidate base prices at €460/t ex-works, whilst some producers were already testing higher levels for June. The market received additional support from a seasonal upturn in construction, as well as infrastructure and railway projects.

At the same time, underlying demand remained volatile. Buyers were cutting back on purchases, operating on a just-in-time basis and not building up stocks due to high prices and a limited ability to pass on costs to end customers. By the end of the month, the market in France and Italy had effectively reached a price ceiling: there were no large orders, and some mills were considering production stoppages to balance supply.

In June, prices are likely to remain close to current levels or see a moderate downward adjustment. Further increases are possible only if supply tightens and demand from the construction sector remains stable.

USA

In the US, the average price of rebar in May stood at $1,017.4/t ex-works, up 1.2% on April. Between 1 May and 5 June ($1,036.2/t), the price was 3.9% higher.

The price rise in May was primarily driven by increases from leading US producers, notably CMC, Nucor, Optimus Steel and Gerdau. Mills sought to pass on higher costs for energy, transport and raw materials to the market. Furthermore, they capitalised on the limited availability of imported products. Imports were losing competitiveness due to tariffs, more expensive logistics and tighter external supply, so buyers increasingly turned to domestic supplies with shorter lead times.

Additional market support came from infrastructure and energy projects, as well as data centre construction, particularly in Texas, the South-East and certain western regions. At the same time, demand remained uneven: private non-residential construction was weakening, distributors reported sluggish activity, and some mills were open to negotiating discounts for larger volumes.

Prices are likely to remain at elevated levels in the near term. Support will come from limited imports, stable scrap supplies and project-driven demand; however, without a more even recovery in construction, the scope for further growth will be limited.

China

Prices for Chinese rebar averaged $468.3/t FOT Warehouse in May, up 3% on April’s figure. Between 1 May and 5 June, the increase was just 0.2% due to a weakening of the upward trend at the end of May. Current offers stand at $463.55/t.

In early May, the market was supported by expectations of a recovery in construction demand following the holidays, seasonal factors and signals of increased support for the property sector from local authorities. Infrastructure and urban projects provided additional positive momentum, which temporarily improved trader sentiment and supported prices.

However, by the second half of the month, the market had turned downward. The main reason was a weakening of real demand: rains in the south of the country hampered construction activity, the property sector remained weak, and the pace of infrastructure works was insufficient to offset the decline. At the same time, improved margins prompted factories to ramp up output, which heightened the risk of oversupply. By the end of May, the pace of inventory reduction had slowed, and manufacturers’ stock levels began to rise.

Going forward, prices are likely to remain under pressure due to the onset of the summer off-season, weather factors and weak demand from the construction sector. Support may come only from raw material costs and isolated speculative purchases.