Although not all of the March 1-effective price increase for US domestic wire rod has absorbed in the market, US wire rod mills took advantage of the strong scrap price trend this month and announced another price increase late last week. Effective April 1, the new increase of $2.25 cwt. ($45/nt or $50/mt) is being met with skepticism in the market.
Sources tell SteelOrbis that at most, the new price increase will allow the remainder of the March increase to bump spot prices. Already, prices are up another $0.50 cwt. ($10/nt or $11/mt) this week, bringing the average spot price range up to $29.50-$30.50 cwt. ($590-$610/nt or $650-$672/mt) ex-mill. This leaves $0.75 cwt. ($15/nt or $18/mt) remaining of the March 1 increase.
Much of the skepticism regarding the April 1 increase is due to early speculation that scrap prices will move sideways next month. Without the leverage of higher raw material costs, any push for higher wire rod prices will most likely be met with resistance. However, if the primary objective of the newest price increase was to support the March 1 increase, “mills will win that round,” one source noted.