Steel Wire Rod prices in the US market remained stable at the end of November as demand from the downstream constructing sectors decreased. Furthermore, the market participants continued to be apprehensive about the United States federal interest rate rise trend. Which maintained a flat market trend throughout the the United States spot market.
It is anticipated that the new agreements will drive up the price of steel wire rods in the coming weeks as significant progress is shown by the United States Komatsu America Corp., Volvo, and McCarthy Building Companies Inc.
Even though the production of rebar has increased. There has been a noticeable decline in the rate of Steel Wire Rod output in neighbouring countries like Mexico.
In particular, these nearby nations’ monthly output of steel wire rods has dropped by 6.5%. Steel Wire Rod supplies in domestic warehouses across the United States have been impacted as a result of this decrease.
Because of the upward trend in upstream coking steel and coal scrap prices in both domestic and foreign markets. Analysts have projected a possible price increase.
Nevertheless, the demand for steel wire rods from the USA’s downstream constructing sectors remained unchanged, defying anticipations of a price increase.
The industry faced difficulties as a result of high interest rates and stringent credit requirements. Even though three significant construction projects were started. These factors have slowed down construction and are likely to do so in the near future.
Stability in Steel Wire Rod Prices Amid Decreased Demand:
October saw a 7% decrease in all construction begins in the United States, bringing the seasonally adjusted yearly rate down to USD 1.1 trillion. The growth rate of steel wire rods in the United States spot market was hampered by a general slowdown in gas and utility projects. Which was the cause of this decline.
According to market analysts, the Federal Reserve will probably hold off on raising interest rates for the foreseeable future.
It will take time, though, before any easing measures are considered. Over the upcoming months, sales in the construction industry are predicted to continue to soften. The United States Steel Wire Rod market’s non-residential construction segment saw growth in spite of this general trend.
October saw an 8% rise in this category, which includes manufacturing, institutional, and commercial projects.
Manufacturing activity was the main driver of the seasonally adjusted annual rate, which came in at USD 490 billion. Three noteworthy projects played a major role in this encouraging development.
These include the USD 2.2 billion Hyundai and LG electric vehicle battery plant in Ellabell, Georgia. The USD 1.5 billion Nucor Sheet Mill in Apple Grove, West Virginia. And the USD 7.5 billion Micron semiconductor production facility in Boise, Idaho.
The non-residential construction projects were notable examples of success in the otherwise difficult US Steel Wire Rod market environment.
ChemAnalyst predicts that steel wire rod prices will slightly increase in the coming week as large-scale projects boost demand for US steel wire rods.
Furthermore, the output of Steel Wire Rods is likely to decrease as the arrival of winter slows the production rate in the United States spot market.