In the Turkish wire rod market, Turkish mills' efforts to transform the "buyers' market" into a "sellers' market" by raising their prices have become ,increasingly prominent during the current week. The Turkish mills have defended their view that the wire rod market has hit bottom and so they increased their wire rod offer price levels for end-users approaching mid-week. This week, it is said that the end-users in the domestic market whose inventories are about to run out still have to satisfy some of their orders and so they are making purchases even with small tonnages.
In parallel with this strategy, the Turkish mills' wire rod export offers, in particular for grades 1006 (drawing) and 1008 (mesh quality), have reached levels of $460-500/mt FOB, increasing by $30-40/mt week on week. It is clearly observed that the Turkish mills, who have over the past week given export offers at lower levels, have been trying to nurture an optimistic atmosphere in the export market as well as in the domestic market. The most important question is; will this price level be accepted in the international markets where there are no signs of a recovery for the time being?
During the current week, some mills have continued to offer SG2 grade wire rod at the level of $800/mt and S1 grade wire rod at $590/mt. Also, it is heard that some welding quality wire rod buyers in the domestic market have delayed their purchasing activities due to their existing stock levels.
As for the end-users in the domestic market, the most important problems are whether the increases seen in wire rod prices will continue or not, also the difficulty of deciding whether to purchase new materials or to maintain low stock levels as in previous months. Another difficulty is the late response made by some mills to end-users' price inquiries.
This week, the price of mesh quality wire rod in the Spanish domestic market has showed a little softening and decreased to the level of €380-390/mt ($487-500/mt), delivered to customer, excluding VAT. Also it is said that, in the Italian market, the price for the same grade wire rod is currently standing at €380/mt ($487/mt), delivered to customer, excluding VAT. Lately, the main focus of attention in the Italian domestic market is the prospective bottom level of scrap prices. When this happens, it is expected that wire rod prices will also be able to start to increase after touching their bottom levels. Meanwhile, it is heard that some Italian mills have high stock levels; however, most end-user inventories have been sold off. Rumors are circulating that the Italian domestic market, which is expected to show a recovery within the next few weeks, will be able to conclude its main recovery by the end of December.
In addition, it is heard that the prices of mesh quality wire rod in the Bulgarian domestic market are maintaining levels of BGN 880-910/mt ($577-597/mt). Currently, end-user demand has remained unchanged in this market. Also it is heard that import offers from Ukraine to Bulgaria are standing at levels of €320-340/mt ($410-436/mt) FOB Ukraine, for November shipments.
On the other hand, it is heard that the prices of mesh quality wire rod in the Greek domestic market are in the range of €450-455/mt ($577-584/mt), excluding VAT. And it is mentioned that,an end-user from the country in question has made a counter-bid to Turkey for wire rod, but the Turkish mills are not giving an inch since the price level is too low.
As mentioned above, the Turkish mills are making revisions to their export offers this week. The acceptance of new price levels by end-users will influence the direction the mills take. In the coming days it will be seen more clearly whether the optimistic atmosphere the mills are seeking to create will be able to overcome the indecision of the end-users and whether this optimistic atmosphere will also affect the international markets.