US wire rod market - Chinese import prices continue to climb

Import mesh quality wire rod offers in the US have risen by another $0.25 cwt. ($5.50 /mt or $5.00 /nt) this week, and market-watchers predict that this upward trend will continue into the next several months. Import offers for mesh quality wire rod now range from $21.50 cwt. to $22.50 cwt. ($474 /mt to $496 /mt or $430 /nt to $450 /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. The upward pricing trend for mesh wire rod imports continues for several reasons. There are signs that the Chinese domestic wire rod market is picking up. Also, the Chinese simply follow the trend of other rod-exporting nations and are raising their price level somewhat. Chinese mills are already sold out for May rolling, and higher prices are expected for June. Although the market is not heating up as rapidly as the Chinese flat rolled market, it is slowly improving and will continue to do so, at least for the next several months. The state of the Turkish and European wire rod markets remains strong as well. In the domestic market, nothing has changed since last week. In the long run, prices will increase with the world market prices. In the short run, domestic prices will remain soft for the next couple of months. As long as the scrap price does not register sharp increases or decreases, the domestic wire rod pricing trend will remain neutral. Domestic offers still range 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 still getting low carbon wire rods under $26.00 cwt. ($573 /mt or $520 /nt) for their commitment of significant tons.