NEW YORK Wire rod mills and buyers are preparing to start negotiating prices ahead of the American Wire Producers Associations Government Affairs Conference in Washington Sept. 18-20, and market participants anticipate a downtick in tags for October shipment.
"Wire rod numbers are holding their own and nobodys putting my feet to the fire, but there is a rumor that theres some relief coming," one Midwest wire rod buyer said.
AMMs Chicago shredded automotive scrap price fell about $10 per ton this month (amm.com, Sept. 6), and rod buyers whose tags are indexed to scrap will see a drop. Rod buyers who negotiate each month said demand is mediocre, and with scrap falling the mills will have a tough time holding tags steady.
"We havent had vendor discussions, but I have a hard time making the case for going sideways, given the weakness in order books," one wire rod buyer in the South said.
Wire mesh-quality rod is transacting at around $640 per ton ($32 per hundredweight) f.o.b. mill, industrial-quality rod is $650 per ton ($32.50 per cwt) and high-carbon rod is $700 per ton ($35 per cwt). Cold-heading-quality wire rod is trading at $770 per ton ($38.50 per cwt).
Construction has been weak due to heavy rainfall in many parts of the country, driving down demand for construction-related wire products.
"The implication has been rain, rain, rain so our business is off, but business hasnt picked up. ... Its not like its dried out and all of a sudden constructions booming," a second rod buyer in the South said.
"Things have been very lackluster," a mill source said. "Everybodys open and hungry for business."