NEW YORK The steel wire
rod market is on an even keel, with market players hesitant to
make any big price moves even after one steelmaker reduced its
scrap surcharge last week.
Consumers are holding their
breath until the spring as transaction prices show little
movement even after Charlotte, N.C.-based Nucor Corp. cut its
scrap surcharge on wire rod by $10 per ton (
amm.com, Feb. 19), and market players say buyers
have been left some negotiating room with their suppliers.
"We didnt (see a price
drop) with all of our suppliers. Some move a little more
mechanically, and for some its more of a negotiated
fashion," a source at a fabricator in the South said.
A Midwest fabricator source said
he had seen tags rise slightly, with the market banking that
scrap will settle up in March. "The mills are bumping prices a
little here and there where they can," he said. "(But) really
nothing has changed."
"Prices have been fairly stable.
... So thats a reason not be jumping the gun and trying
to gauge the market," said a source at a Southeast wire
fabricator that is keeping a lightly stocked inventory.
Domestic market prices remained
unchanged Feb. 28, with mesh-quality low-carbon wire rod
holding at $33.50 per hundredweight ($670 per ton) f.o.b. mill,
industrial-quality low-carbon rod at $34 per cwt ($680 per
ton), high-carbon wire rod at $35.25 per cwt ($705 per ton) and
cold-heading quality product at $38 per cwt ($760 per ton).
Rod buyers have kept their
stocks slim through the winter, wary of potential price
"Its pretty quiet. People
are still trying to figure out whats happening," one mill
Buyers also have little
incentive to stock up on rod, with lead times from domestic
mills shorter than a month for most customers and as short as
two to three weeks for others.
"Were being disciplined
here because the mills are still at a month turnaround," a
second Midwest wire fabricator source said.
Market rumblings, including
increased Chinese rod import prices and long-term optimism in
the construction sector, have yet to have a discernible effect
on the market.
Import prices for Chinese rod
inched up slightly around the Chinese New Year holiday, which
could give more leeway to domestic producers to control prices,
market sources have said. Imports from China have been
conspicuously low on wider rod sizes, a gap that wire
fabricators have turned to domestic sources to fill.
"The domestics are going to be
playing their own ball game. Theyre going to be in the
drivers seat for about a month and a half," a second
southern fabricator source said.
A trader was less confident.
"(Imports) were an emerging picture. Its not fully
solidified," he said. "Its hard for us to find rhyme or
reason with this."
Market players expect a quiet
market in the next few weeks, with short lead times
"(Lean inventories) is the trend
with a lot of customers these days, but hopefully theyll
get a little more confident and things will get busier," a
second mill source said. "The first quarter has been relatively
slow. Were just waiting to see if things are going to
pick up during the second half."