NEW YORK — Nucor Corp. announced a price increase of $40 per ton ($2 per hundredweight) on wire rod following an uptick in scrap prices last week, but it remains unclear how much of the change will stick, market sources said.

The company hiked rod prices effective with April 1 shipments, according to letters to customers dated March 8 and 11. It was the first announced increase in rod prices since November.

"They’re going to give it a go this week, but it’s too early to tell," one rod buyer said.

The move came just a few days after scrap transactions in Chicago settled up across the board, with AMM’s consumer buying price for shredded auto scrap—an industry benchmark for rod prices—rising $35 per ton (amm.com, March 7). The wire rod hike outpaced the shredded scrap increase by $5 per ton.

"The mills think that demands will support this pricing and are going to be very bullish because of pent-up demand," a second rod buyer said.

Market sources said it’s too early to tell whether the new prices will hold.

"I think you’ll see these increases stick eventually," a source at one rod distributor said. "It may take some time, but it seems like raw material costs and fuel costs are going up as well. It would be nice to see a little more demand, which would make it easier for the mills to hold firm."

Another rod buyer disagreed. "(It’s) questionable. I am guessing ‘no,’ but we should have a better feel for it over the next week," he said.

Charlotte, N.C.-based Nucor also announced that it was raising its surcharge on special bar quality products by $43 per ton ($2.15 per cwt) effective April 1, hand-in-hand with a $43-per-ton increase in AMM’s consumer buying price for No. 1 busheling (amm.com, March 12).

There was no indication late March 12 as to whether other mills would follow Nucor’s lead on wire rod, but sources said that other producers likely will announce rod price hikes.

"I think you’ll see others will come around with something identical," a third rod buyer said.