NEW YORK Steel wire rod prices are unchanged heading into November as weak demand and competition from imports leaves little room for an increase, mill sources and buyers told AMM.
Mesh-quality wire rod remains around $630 per ton ($31.50 per hundredweight), industrial-quality rod is about $640 per ton ($32 per cwt), high-carbon rod is around $680 per ton ($34 per cwt) and cold-heading-quality rod is about $770 per ton ($38.50 per cwt).
"Prices are moving sideways," a mill source said. "Volume is really a huge issue with so much import material."
Buyers said they have not paid the $20-per-ton ($1-per-cwt) increase announced by Nucor Corp. (amm.com, Oct. 22), which other mills have yet to follow.
Mill shipments reportedly are weak, with most producers operating well below capacity utilization and buyers receiving material earlier than expected as mills are impatient to move wire rod out the door.
"I know theres plenty of capacity at (one of our suppliers). Theyre behind their plan for the year in terms of volume, and theyre not full," a wire rod buyer said.
Furthermore, rod buyers said they would not be able to pass on a price increase to their customers.
"For my markets, theres no chance of the mills getting a price increase. And theres no chance my customers would allow me to raise my prices. For me to raise prices is just impossible," a second wire rod buyer said.
Demand is lower due to rod buyers holding substantial amounts of Chinese material and many reportedly doing less business than last year.
Chinese material continues to be offered at a large spread compared with domestic material, with wire rod prices at $540 to $560 per ton c.i.f. Port of Houston and orders reportedly booked at as low as around $530 per ton c.i.f. Houston. The spread between domestic and imported product on low-carbon material is about $80 per ton and the spread on high-carbon material is more than $100 per ton, sources said.
Mills, buyers and traders suspect a trade petition against China may be filed in the first quarter of 2014 (amm.com, Oct. 22).
"The domestic mills go through a certain amount of time of saber rattling," a second trader said. "Does it seem likely there will be a trade case? Yes."