Turkish wire rod producers have sought to correct their prices in an upward direction since the beginning of the current week, supported in this attempt by scrap purchase activity and the uptrend in billet prices; however, no significant recovery on the demand side in Turkey is observed for the time being. Weak finished steel demand in the international markets in particular has created difficult conditions for new wire rod purchase activity. There was an increase in the purchase activity of some wire/nail producers last week since the end of the month was approaching. However, other wire/nail producers are still hesitating to buy wire rods for stocking purposes, preferring to buy only enough material to meet their needs due to the price fluctuations.
Looking at the situation in the Turkish wire rod export markets this week, demand in the the Far East is silent, whereas sales to West Africa in particular are gaining speed thanks to the relatively improved seasonal conditions. Another indication of the increasing importance of the West African market is the fact that the Second Turkish Exports Fair will be held in Senegal on November 12-15. Additionally, it is heard that there are some offers from the CIS to West Africa for drawing quality wire rod at $520-530/mt CFR West Africa for December shipment.
Meanwhile, although the wire rod sales volume from Turkey to the US increased in October, US buyers have this week been reluctant to make new purchases from Turkey. On the other hand, it is heard that the ex-Turkey wire rod offer volume to South America is increasing.
Looking at the southern European wire rod markets, prices in Italy are still softening; the mesh grade wire rod price range in this local market is at €320-330/mt delivered to customer excluding VAT, whereas prices of drawing quality material are at €340-350/mt with the same terms. Weak demand for wire can be cited as one of the reasons for the slackening of the wire rod price in the market.
While Italy's export offer prices for mesh grade wire rod are at €310-320/mt FOB Italy for November-December shipment, it is heard that Spanish offers for the same material are at €315-325/mt FOB Spain with the same terms. Additionally, it is also heard that some Turkish wire rod producers have started to produce drawing quality wire rod of improved quality thanks to the billets that they bought from southern Europe in October. In wire rod sales activity to North Africa, competition between the Turkish and Italian/Spanish offers is being influenced by the €/$ exchange rate, despite the situation of weak demand. Also, finished product sales from Turkey to Libya have this week continued to gain speed.
In the coming period, market players will watch closely to see whether new export markets will arise to provide support for the Turkish producers' export activities.