US wire rod mills have kept prices level in response to the slight downtrend in scrap pricing, but early speculation points to a possible uptrend next month.
As predicted last week, US wire rod mills reacted to the $20/long ton drop in shredded scrap prices by keeping prices level for yet another month. Sources tell SteelOrbis that mills are doing well on a month-to-month basis, and thus did not feel the need to implement a price decrease based on lower raw material costs. Current spot prices for US wire rod are still in the range of $37.50-$38.50 cwt. ($827-$849/mt or $750-$770/nt) ex-Midwest mill, while demand remains decent and order activity is steady.
However, early speculation for June scrap prices could possibly lead to a slight uptrend in US domestic wire rod prices. SteelOrbis has learned that based on strong export activity, shredded scrap pricing in June might regain the $20/lt it dropped this month. If so, US wire rod mills might react to the increase with a slight bump in asking prices, even though a $20/lt increase would peg scrap pricing exactly where it--along with wire rod prices--had been since February. Unlike distributors and wire product producers that have embraced the months-long stable trend, wire rod mills are apparently eager to "stir the pot."
As for imports, Turkish wire rod sales prices in the US have not changed in the last week, even though the local Turkish wire rod market is in the midst of an uptrend. One Midwest trader reported that in general, traders will have difficulty raising sales prices if Turkish mills increase wire rod offers to the US--there are not many orders at the current level of $37.00-$38.00 cwt. ($816-$838/mt or $740-$760/nt) duty paid FOB loaded truck in US Gulf ports, and at only $0.50 cwt. ($11/mt or $10/nt) under US domestic offerings, there is nowhere for Turkish offers to go.