Cold-heading quality rod prices lose edge

Jul 03, 2012 | 12:07 PM | Michael Cowden

Tags  wire rod, cold-heading quality, high-carbon rod, scrap, shredded, busheling, rod prices, steel Michael Cowden

TORONTO — Some grades and sizes of cold-heading quality wire rod are nearing or, in some cases, at the same level as high-carbon wire rod prices, market sources said, marking a change from historic norms where the cold-heading grades usually garner a premium.

The move reflects the equally unusual tight spread between No. 1 busheling scrap and shredded scrap, sources said.

In addition, while cold-heading quality bar mills have generally been disciplined in bringing prices down along with scrap tags, many high-carbon rod mills have over the last month tried to hold on to a decrease of roughly $30 per ton ($1.50 per hundredweight) despite scrap prices falling by nearly twice that amount.

"On high-carbon (rod), the more commodity market, everyone has announced a $30-per-ton reduction that has generally been followed," one rod consumer said. "But the cold-heading market has behaved with its historic discipline" in following scrap prices.....