NEW YORK The wire rod
import market has gone limp, with potential buyers turning
their sights to anticipated near-term price decreases from
domestic mills and the summer slowdown.
"In the summer, most people are
well advised to just sit back and relaxjust chill," one
buyer said. "The bottom line is that theres plenty of
steel out there. Im surely not going to buy anything
The excitement over Chinese rod
in recent months has slowly given way due to increased prices
from foreign mills and a slowdown in the domestic markets as a
$50-per-gross-ton drop in Detroit ferrous scrap prices
(AMM, June 6) paved the way for other cities to
On Wednesday, Gerdau Long Steel
North America lowered its prices for reinforcing bar, merchant
bar and beam products by $15 per ton. While there hasnt
yet been any movement on wire rod, a number of buyers
anticipated a definite decrease for July.
"People just arent buying
right now until they have a good feel on where scrap is
heading," one trader said. "Prices are softening. People are
doing the math: shredded has gone down, oil prices are falling.
Itll be a tough act to sell any rod."
Rod import license applications
plunged to 88,484 tonnes in May, according to the Commerce
Departments Import Administration. Thats down 37.1
percent from Aprils preliminary imports of 140,605
tonnes, U.S. Census Bureau data show. While the flow of
material coming from Canada looked poised to remain virtually
unchanged (at 35,428 tonnes vs. 34,329 tonnes), product from
Turkey was set to fall by more than 53 percent (to 18,732
tonnes from 40,533 tonnes) and those from China by 81.2 percent
(to 4,125 tonnes from 21,902 tonnes) in the same
Rod from China is still expected
to be in the pipeline until at least early September, other
traders said, although those numbers seem to be declining
"The market has seized up quite
a bit," a second trader said. "The Chinese offers look
interesting. But with this downward trend, itll be very
difficult to make any sales."
Turkish material, on the other
hand, continues to be some $20 to $30 per short ton more costly
than Chinese rod, as Turkish mills have moved their focus to
Africa and the Middle East.
Offer prices for wire rod
imports to the Port of Houston were between $665 to $690 per
short ton, although no transactions were reported in the past
Moving forward, traders said
that major movements wont happen in the near term.
"I dont think there will
be any huge movements in the rod market going forwardnot,
at least, for the next four to six months, that I can tell
you," the first trader said.