With higher scrap prices on the horizon, many domestic wire rod mills are trying to push for their latest price increase before raw material costs go up further.
For the last couple weeks, the market has largely ignored US wire rod mills' $1.00 cwt. ($22/mt or $20/nt) price increase announced in mid-November, and mills have not been aggressively pursuing it--until now. With the near-certainty of another hike in shredded scrap pricing (current estimates are around $30/long ton), some mills are trying to hedge against the possibility of absorbing further raw material costs by pushing up asking prices into the range of $32.50-$33.50 cwt. ($717-$739/mt or $650-$670/nt) ex-mill, $1.00 higher than what they were settling on last week. However, spot prices have been lingering around $31.50 cwt. ($694/mt or $630/nt) ex-mill since the middle of November, and there is not a strong indication that the mills' latest move will do anything to firm them up.
What it has done, however, is light up the lines in traders' offices. In the last week or so, US wire rod buyers have increased import inquiries to traders--a situation that is viewed as more of a general feeling out of the market rather than actual purchasing activity. Import offers are still not too attractive compared to domestics, especially after Turkey finally increased prices after weeks of pressure from rising scrap costs overseas.
Current offers from Turkish mills are now in the range of $31.50-$32.50 cwt. ($694-$717/mt or $630-$650/nt) duty paid FOB loaded truck in US Gulf ports, an increase of $1.00 cwt. from last week. However, the increase is subject to market acceptance, and if US buyers push for a more desirable spread between domestics and imports, there's a good chance they could get a decent deal.