Import prices for mesh
wire rod have continued their slow ascent by $0.25 cwt. ($5.50 /mt or $5.00 /nt) since last week, due to increased asking prices from
China and
Turkey.
Chinese mills are getting busier, and prices continue to slowly move up. Some of the lower priced offers are disappearing from the market one by one, although Chinese home prices are still lower than their export prices.
Turkish prices are also going up, and the European market still remains relatively strong. Turkish mills currently cannot compete with Chinese imports, and they indicate they are selling their export tonnage mostly to
Europe. Some mills that can make rebars and
wire rods interchangeably have switched their
production to rebars for better returns.
So far, in March 2006,
China has been the largest exporter of
wire rod to the US, with
Turkey coming in second.
Import offers for mesh quality
wire rod now range from $21.25 cwt. to $22.25 cwt. ($468 /mt to $491 /nt or $425 /nt to $445 /nt) FOB loaded truck in US Gulf ports. For drawing quality, import prices remain at a range of $22.50 cwt. to $23.50 cwt. ($496 /mt to $518 /mt or $450 /nt to $470 nt) FOB loaded truck in US Gulf ports.
We have not seen price increases on import drawing quality yet, but there is pressure on supply.
Contrary to imports, domestic prices have declined by $0.50 cwt. ($11 /mt or $10 /nt) in the last couple of weeks. The price decrease didn't happen across the board, but more on a selective customer basis, based on the purchasing volume, previous price level and
wire drawing application. Average offer prices are down by $0.50 cwt, now ranging from $26.00 cwt. to $27.00 cwt. ($573 /mt to $595 /mt or $520 /nt to $540 /nt) for low carbon FOB mill, and from $28.50 cwt. to $30.50 cwt. ($628 /mt to $672 /mt or $570 /nt to $610 /nt) for high carbon FOB mill. Some high volume buyers are getting low carbon
wire rods under $26.00 cwt. ($573 /mt or $520 /nt) for their commitment of significant tons.
Domestic offering prices have declined because there is no upward pressure from the
scrap market, and domestic mills want to keep their order books full. With record amounts of imports coming in, some weak spots have developed on domestic mills' order backlogs. If these minor adjustments work, in the next couple of months, the domestic pricing trend should return to neutral.