Although demand for wire rod in the US is still relatively lackluster, the market received a “jolt of optimism” this week, according to sources, after the US Department of Commerce launched this week an investigation into wire rod imports from 10 countries. Preliminary AD margins won’t be released until September (preliminary CVD margins for Turkey and Italy are due in June), but the alleged margins included in the DOC’s investigation announcement “have made mills very happy,” according to sources.
Ranging from 18.89 percent (for Italy) all the way to 756.93 percent (for Russia), the alleged margins are not guaranteed to carry over into the DOC’s preliminary determination. But sources tell SteelOrbis that even if preliminary and final margins “come anywhere close” to the alleged margins, wire rod imports as a whole would “slow to a trickle,” giving US domestic mills the upper hand in negotiations with customers.
Already, some sources report mill firmness with current spot prices, which are still in the range of $29.50-$30.50 cwt. ($590-$610/nt or $650-$672/mt) ex-mill—unchanged in the last week. Other sources predict a gradual push upward in the near-term, regardless of how US domestic scrap prices trend in May.
“If imports are out of the picture,” one source said, “it won’t matter what scrap does—mills will be able to set whatever price they want, because there won’t be an import market to turn to.”