The pricing trend for domestic
wire rod is still strong, as the market is humming with rumors of further price increases.
As we announced last week, domestic mills announced a $30 /nt ($33 /mt or $1.50 cwt.) price increase for March shipments. For now, prices remain at this range of $26.00 cwt. to $27.00 cwt. ($573 /mt to $595 /mt or $520 /nt to $540 /nt) FOB mill for low carbon, and from $28.50 cwt. to $29.50 cwt. ($628 /mt to $650 /mt or $570 /nt to $590 /nt) FOB mill for high carbon. Sources say that another price increase is imminent.
Wire rod buyers report that business is getting stronger every day as demand improves. However, there are still deals to be made for immediate shipments, especially from a few Northern mills. Some mesh producers indicate competitive domestic pricing despite the long trucking haul.
The import rod market is also still trending up sharply, with prices rising $0.75 cwt. ($16.50 /mt or $15 /nt) in the last week, mostly due to rising raw material costs globally, and also because of the rumors of the VAT rebate reduction for Chinese long products.
Import rod prices now range from $25.50 cwt. to $26.50 cwt. ($562 /mt to $584 /mt or $510 /nt to $530 /nt) FOB, loaded truck, in US Gulf ports, for mesh quality, and from $27.50 cwt. to $28.50 cwt. ($606 /mt to $628 /mt or $550 /nt to $570 /nt) FOB, loaded truck, in US Gulf ports for drawing quality.
The Chinese mills are still on holiday for the Chinese New Year, so they have not been offering much for the last week and most likely, they won't be coming back to the market with new offers for another week. Bookings prior to the Chinese New Year were very slim because US customers were wary of paying the high prices for the few offers that were on the market. However, US customers will eventually have to replenish their inventories and will have to start paying these higher prices in the near future.
Further
wire rod price increases will put pressure on
wire drawers in the US that are already struggling to compete with
wire products imported from
China and
India. Some
wire manufacturers are reportedly looking into buying Chinese
wire products and cutting
production in the US. Some have even given up and moved their
production facilities to
China.