The Yo-Yo Effect: Up and Down Rebar Prices Can Leave Both Owners and Builders Bewildered

The volatility of the U.S. steel market and, subsequently, rebar prices over the past few years has been enough to leave builders and fabricators to their own guesswork when bidding on new contracts.

Rebar Prices

Put quite simply, as the price of structural steel rises and falls, so too does the cost of rebar. Rebar prices tend to follow those of structural steel, within a range of about 10 per cent. The fluctuation of steel prices in general is influenced heavily by imports from Asian markets, and also by the supply of scrap metal scrap metal.

In 2004, the steel market experienced a period of notable volatility. Some builders grappled with whether to cancel or proceed with projects that were to be significantly impacted by the rising price of steel.

In many cases, structural steel and rebar fabricators have to guess what the surcharge will be on work they are currently bidding, even though they won't be delivering the steel until much later. Those sympathetic to contractors will sometimes offer an advance to pay all or part of the surcharge on products not yet delivered, which beats the alternative of having a contractor default on the contract. Choosing a supplier with great delivery service, like that offered by White Cap, is one way to make the rebar buying process a little bit easier.

As of early 2007, concrete analysts pegged U.S. rebar prices as being due for a modest upward swing. They also say that rebar prices in the U.S. will likely experience another increase, after prices were boosted by $15 per short ton on February 1, 2007,and again over $50 per short ton in April, 2007.

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