Although US domestic scrap prices saw a slight gain this month after two months of declines, sources tell SteelOrbis that the raw material trend will have little to no effect on US domestic wire rod prices. Supply in the US wire rod market isn’t tight enough for a $10/mt uptick in scrap to make an impact, sources say, although US domestic wire rod mills might use the scrap trend to firm up large-tonnage deals on the lower end of the spot price range.
However, another source noted that relatively quiet demand in the market and the subsequent need to fill order books could balance out any mill leverage from higher scrap prices, even if the scrap market lifts again in November. As such, current US domestic wire rod spot prices, stable this week in the range of $39.00-$40.00 cwt. ($860-$882/mt or $780-$800/nt) ex-mill, will more likely trend neutral in the near-term.