While US wire rod mills are still holding the line with domestic prices, there have been reports of some spot offers coming under the general range.
There has not been a noticeable uptick in US wire rod demand in the last week, but it might not be as vulnerable as previously predicted. Auto production will likely get a boost in the next few weeks--a representative from Toyota recently said that plants in North America will start operating at 70 percent of normal levels in June, compared to 30 percent this month. Construction is still sluggish, but early speculation points to another month of manufacturing expansion in the US, putting wire rod in a healthy position, demand-wise, for the rest of the second quarter.
However, spot prices for US domestic wire rod are becoming increasingly vulnerable, as weather-related maladies have plagued the Midwest and caused production disruptions and transportation obstacles. As a result, sources tell SteelOrbis that at least one Midwest wire rod mill is offering deals under the current spot range of $37.50-$38.50 cwt. ($827-$849/mt or $750-$770/nt) ex-Midwest mill, frustrating other mills who have successfully maintained price levels for several months. This "breach in the united front," as one Gulf-area wire producer called it, is not exactly indicative of a trend, unless another mill breaks rank and cuts deals to stay competitive and causes a sort of chain reaction.
At least domestic wire rod mills don't have to concern themselves with imports for the time being--despite an uptick in the local Turkish market, import wire rod offers have not increased in the last week, remaining only $0.50 cwt. ($11/mt or $10/nt) below US domestic spot prices. Current offers from Turkey are still in the range of $37.00-$38.00 cwt. ($816-$838/mt or $740-$760/nt) duty paid FOB loaded truck in US Gulf ports, and as with last week, there are not many inquiries to be found at that level.