Wire rod prices drift 20% lower on weak demand

Dec 05, 2008 | 12:22 PM | Corinna Petry

Wire rod producers, distributors, traders and wire drawers say there "is virtually no demand" in December, and prices for most standard grades have fallen around 20 percent, or $180 to $220 per ton ($9 to $11 per hundredweight), since the middle of last month.

"We are seeing prices all over the map now because of the turmoil in the market. There are plenty of offers, some a little high and some very low, but because there is virtually no demand the offers and negotiations don't really mean very much. Buyers are afraid to be long even at lower prices," a rod buyer in the central states said Friday.

"We aren't buying anything," a southeastern producer of wire products said. "There is no telling how low a rod producer might go to get a sizable order while scrap is at a low point. Chaos rules right now and the price book is out the window."

Based on the most recent quotes that buyers received from suppliers, mesh-quality, low-carbon rod has dropped to $740 per ton ($37 per cwt) from $935 per ton ($46.75 per cwt) last month; industrial-quality, low-carbon rod has fallen to $760 per ton ($38 per cwt) from $967 per ton ($48.35 per cwt); high-carbon rod is now $850 per ton ($42.50 per cwt), down from $1,030 per ton ($51.50 per cwt); and cold-heading quality has slipped to $894 per ton ($44.70 per cwt) from $1,120 per ton ($56 per cwt) a month ago.....