The US domestic wire rod market remains quite soft, though some mills are reportedly attempting to add a scrap surcharge to orders to reflect the slight increases in scrap prices that have taken place over the past two months.
While an increase in scrap prices has traditionally resulted in a corresponding increase in long product prices, wire rod demand is so slow that the wire rod mills' scrap surcharge is not likely to be accepted by the market in a large way.
For now, most domestic low carbon offers on the market still range from $27.50 cwt. to $28.50 cwt. ($606 /mt to $628 /mt or $550 /nt to $570 /nt) FOB mill, and high carbon offers still range from $30.00 cwt. to $31.00 cwt. ($661 /mt to $683 /mt or $600 /nt to $620 /nt) FOB mill.
Meanwhile, import rod prices have increased by $0.50 cwt. in the past week, and the import pricing trend for wire rod is still up. However, the price increase means very little, since it does not reflect US market conditions, and won't do anything to spur buying activity. For the most part, import wire rods are higher than domestic prices and are far too high to gain any takers.
Import mesh quality wire rod offers for the US now range from $28.75 cwt. to $29.75 cwt. ($634 /mt to $656 /mt or $475 /nt to $485 /nt) FOB, loaded truck, in US Gulf ports, while import drawing quality rods range from $30.50 cwt. to $31.50 cwt. ($672 /mt to $694 /mt or $610 /nt to $630 /nt) FOB, loaded truck, in US Gulf ports. Prices are slightly higher on the East and West Coast, by approximately $0.50 cwt.
Data from the US Import Administration show that in August wire rod imports totaled 97,868 mt, down from 140,236 mt in July, and down sharply from the 236,073 mt imported in August 2006. The top import sources in August 2007 consisted of the usual players: China (36,349 mt), Canada (21,406 mt), Brazil (15,679 mt), Japan (12,137 mt), and Trinidad & Tobago (5,410 mt).