The pricing trend for US domestic wire rod prices is slightly up, with the general anticipation being that some, if not all, of the announced increases will go through.
While Mittal's announced $55 /nt ($61 /mt or $2.75 cwt.) May increase has not yet taken hold, the majority is expected to go through. However, the recent scrap price decreases could throw some cold water on the market, as the wire industry may put pressure on the mills not to raise prices.
Since last week, domestic wire rod offering prices have not changed, with most offers for low carbon rod continuing to range from $29.00 cwt. to $30.00 cwt. ($640 /mt to $661 /mt or $580 /nt to $600 /nt) FOB mill. High carbon offers still range from $31.50 cwt. to $32.50 cwt. ($694 /mt to $717 /mt or $630 /nt to $650 /nt) FOB mill.
There are currently not too many import offers available on the market, as the Chinese mills have been holding back from offering until the Chinese government institutes VAT rebate reduction on long products, which will occur April 15, 2007. The pricing trend is still up, as the rebate reduction will eventually result in further price increases, and the Chinese domestic wire rod market is strengthening as well.
Other typical import wire rod sources, like Turkey and Venezuela, are currently out of the market, though improving prices have helped some of the traditional industrial quality suppliers, such as Arcelor Mittal Trinidad, to renew their sales to the US, according to the latest import statistics.
Most import wire rod offers have stayed at the same pricing levels since last week, with mesh grade offers on the market still ranging from $27.00 cwt. to $28.00 cwt ($595 /mt to $617 /mt or $540 /nt to $560 /nt). These prices do not reflect any possible changes to the Chinese VAT rebate. Drawing quality offers continue to range from $28.75 cwt. to $29.75 cwt. ($634 /mt to $656 /mt or $575 /nt to $595 /nt).
Data from the US import administration show that year-to-date (January through March 2007), the top five sources of import wire rod to the US have been (rounded to the nearest hundred tons): China at 183,100 mt, Canada at 86,800 mt, Brazil at 37,400 mt, Trinidad & Tobago at 28,800 mt, and Japan at 20,500 mt.