The rising trend of wire rod prices in the Turkish market which started at the end of last week has become more definite this week. The TL/$ exchange rate fluctuations are also shaping domestic wire rod prices in Turkey.
In the domestic market, some Turkish buyers continue to buy limited tonnages just in line with their requirements while others whose inventory levels are considerably low are buying in order to replenish. However, it must also be noted that discounts are still applicable for large tonnage purchases.
In the Turkish domestic market, construction projects have speeded up in the Central Anatolia region prior to the general election. In other regions of Turkey, it is difficult to mention activity at similar levels.
In terms of exports from Turkey, we see that the export markets have contracted while approaching the end of April. In line with the upcoming Easter holiday, EU countries as well as Israel will become silent in terms of demand. Prior to the holidays, the domestic wire rod price level in Italy indicates a drop on euro basis for drawing quality wire rod, standing at €525-535/mt ($764-779/mt) delivered to customer.
This week another remarkable point in terms of Turkish wire rod exports is the inconsistency of the euro/US dollar exchange rate. The exchange rate, having fluctuated throughout the week is standing at 1.46 as of today. This situation is also causing hesitation on the side of Turkish buyers when approaching imports of European wire rod. For instance, Turkish buyers are hesitant to book medium carbon wire rod ex-Italy for May shipment offered at €545-550/mt ($790-798/mt), also taking the time needed for arrival of cargoes into account.
According to Turkish Metal and Mineral Exporters Association (IMMIB) data for March 2011, even though wire rod sales from Turkey to the US continue, the rise seen in exports to Brazil is remarkable. Singapore, one of the major export markets of Turkish producers, also appear to have in terms of imports from Turkey during March. Italy and Kenya also were notable export destinations for Turkish wire rod during March. Furthermore, EU countries stand out as buyers of Turkish end-products (such as wire, nails, bolts, nuts), particular Germany and the Netherlands.
Turkey's major wire rod export markets in March:
Country | 2010 Volume (mt) | 2011Volume (mt) | Change (%) |
USA | 21,552 | 17,843 | -17.21 |
Brazil | 6,051 | 13,747 | 127.19 |
Singapore | - | 13,632 | 100 |
592 | 11,950 | 1.918.41 | |
2,900 | 10,345 | 256.72 | |
Tunisia | - | 5,719 | 100 |
S. Korea | 1,124 | 5,799 | 415.82 |
Total | 74,564 | 112,896 | 51.41 |