Import prices of ordinary wire rods into Japan have been on an uptrend since the beginning of the Lunar New Year festival. Prices also found support from high sea freight rates and depreciation of national currency, yen, thus making imports unviable.
Offers from Vietnam, the major wire rods exporting country, have risen by $50/tonne (t) since the beginning of the Chinese New Year. A trading company said, “Vietnamese wire mills have raised their prices in line with rising Chinese market conditions. Mills are not willing to export to Japan on lower than quoted offer prices.”
Meanwhile, Japanese wire rod fabricators have continued to focus on procuring domestic materials due to increased wire rods import prices. Since last year, wire rod manufacturers have raised prices by a total of JPY 50,000/t ($433/t). Considering the current high prices of steel scrap and the rise in steelmaking raw materials prices, there is a possibility of a further price increase in wire rods.
In response to the rise in wire rod prices, producers have been intermittently raising prices of the end products – iron wire and wire products – since last year. Distribution companies have also moved to pass on prices to consumers. However, the rising price trend had partly eased since the beginning of this year due to low demand in winters.
Outlook
It is expected that wire rod import prices will continue the upward trend amidst limited import contracts. Distributors dealing with ordinary line products have begun to tell consumers that “the price of iron wire for secondary concrete products will be raised from March”. The distribution companies are likely to look for opportunities to raise prices while maintaining their sales.
Note: This insight has been published in accordance with an article exchange agreement between SteelMint and Japan Metal Daily.
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