US wire rod market – Domestics still warm, imports cool off

While the domestic pricing trend for wire rod is still slightly up as the market anticipates another small increase, import wire rod prices have decreased since last week and are now trending slightly down. Mesh grade import offers in the market now range from $24.00 cwt. to $25.00 cwt. ($529 /mt to $551 /mt or $480 /nt to $500 /nt) FOB, loaded-truck, in US Gulf, a $0.50 cwt. decrease from last week. Industrial quality (drawing) wire rod has also softened some, now ranging from $25.75 cwt. to $26.75 cwt. ($568 /mt to $590 /mt or $515 /nt to $535 /nt) FOB, loaded-truck, in US Gulf ports, a $0.25 cwt. decrease from last week. Chinese prices are softening quickly, and Turkish prices are softening as well, though not at as fast of a rate. The current crisis in the Middle East is also affecting the import wire rod market as people are nervous about buying big tonnage in that region because of the current instability. Any unsold tonnage into that region could very well find its way to the US. The domestic rod makers, on the other hand, are still fairly busy, major domestic wire rod producers Mittal, Keystone, and Ameristeel have announced price increases from $20 /nt to $30 /nt for August. However, the verdict is still out as to when this increase will be realized, or if it will go through at all. Domestic wire rod producers' announced June increases were pushed to July, and it is possible that the August increases might not take place until September or later. Large tonnage rod buyers will put up stiff resistance to pay any increase at all. The domestic pricing trend is still slightly up, but with the falling import prices and slowing economy (prompted by the high oil prices and high interest rates), the trend might not stay up for too much longer. Still, demand is decent for the time being. The wire business is still good, though it is not as strong as it was two to three months ago. This week, domestic wire rod offers still range from $27.00 cwt. to $28.00 cwt. ($595 /mt to $617 /mt or $540 /nt to $560 /nt) FOB mill for low carbon, and from $29.50 cwt. to $31.50 cwt. ($650 /mt to $694 /mt or $590 /nt to $630 /nt) FOB mill for high carbon.