Softening scrap, weak demand and a growing desperation for orders has further loosened US domestic mills' grip on wire rod spot prices.
The $10-$20/long ton drop in October shredded scrap prices (depending on region) did US domestic wire rod mills no favors--already facing a weak demand environment and a reluctance of buyers to purchase beyond their minimal needs, US mills were banking on a sideways shredded scrap trend to stave off the growing downward trend. However, without even raw material costs to keep them aloft, domestic wire rod spot prices have declined again this week, by approximately $0.25 cwt. ($5.50/mt or $5/nt). Sources tell SteelOrbis that the new spot range of $36.00-$37.00 cwt. ($794-$816/mt or $720-$740/nt) ex-Midwest mill will continue to tick down in the near-term, at least until scrap prices rise with the seasonal supply tightening in winter.
Another consequence of the US domestic downtrend is a growing disinterest in import offers, even as Turkish wire rod prices decline at a much faster rate. In the last week alone, Turkish import wire rod offers to the US plunged by $1.25 cwt. ($28/mt or $25/nt), bringing the price range down to $35.75-$36.75 cwt. ($788-$810/mt or $715-$735/nt) DDP loaded truck in US Gulf ports. However, traders tell SteelOrbis that even though Turkish wire rod prices have not hit bottom, US buyers are not currently interested in booking the large tonnages necessary for overseas orders, especially when they believe prices for their preferred small orders at US domestic mills will also continue to fall.
As for Spanish wire rod, inquiries have quieted in the last week--Spanish wire rod mills base their offers on the euro, and considering the euro's recent strengthening against the US dollar, wire rod from Spain is not exactly competitive in the US at the moment. The last known prices, however, were in the range of $37.50-$38.50 cwt. ($827-$849/mt or $750-$770/nt) DDP loaded truck in US Gulf ports.
