The second price increase for import wire rod offers in as many weeks has had virtually no effect on the soft US domestic wire rod market.
Although US interest in imported wire rod offers from Turkey has not changed in the last week, prices have increased--most offers are now in the range of $38.50-$39.50 cwt. ($849-$871/mt or $770-$790/nt) DDP loaded truck in US Gulf ports, reflecting a minor bump of $0.50 cwt. ($11/mt or $10/nt) in the last week. While such prices are unattractively high--about $1.00 cwt. ($22/mt or $20/nt) above US spot prices--some traders are expecting that the US domestic market will have hit bottom and started to swing up by the time import orders placed now arrive in early fall. For now, however, US interest in imports is stagnant.
While the forecast for US domestic price trends is hazy that far out, predictions for next month are grim. US wire rod mills, still lamenting the July price increase that came and went without success, are struggling to hold onto current spot prices as the annual summer doldrums roll along. Demand is still weak, purchasing activity is still operating on an as-needed basis, and speculation for August scrap prices indicate that not even the possibility of a raw material-based cost push is on the horizon--all signs pointing to a downtrend right around the corner.
Sources tell SteelOrbis that the only thing keeping domestic spot prices stable is mill unity in both prices and production levels. But there is a good chance that mills will soon start to quietly chip away at the current spot price level of $37.50-$38.50 cwt. ($827-$849/mt or $750-$770/nt) ex-Midwest mill, perhaps even before scrap prices are settled next month. However, sources tell SteelOrbis that any downtrend in prices will be slow and in small increments.