In the Turkish domestic wire rod market Ramadan is still affecting final product (wire, nail, etc.) sales. While final product manufacturers continue to make wire rod bookings in order to complete their received orders, many manufacturers have reduced their capacity usage rates. In the meantime, the fluctuations in the US dollar/Turkish lira exchange rate are making it difficult for wire rod buyers to conclude bookings from the domestic market.
Thus, most Turkish wire rod buyers are assessing wire rod import offers. However, since the current market situation casts a shadow on the future price trend in September, buyers have continued to show reluctance towards import offers.
In the Middle East, some buyers in Saudi Arabia have started to order wire rod to be delivered in September, in order to increase their inventory levels.
On the other hand, in the Vietnamese domestic market mesh quality wire rod prices have remained unchanged at VDN 16.1 million/mt ($776/mt) ex-works, on actual weight basis, including 10 percent VAT and all taxes. However, it is thought that Vietnamese producers may attempt to increase their prices next week. Amid sluggish demand in Vietnam, it is yet to be seen how buyers will react to these likely price increases.
This week, ex-CIS low carbon wire rod offers have not changed as compared to last week, remaining at $745-750/mt FOB on actual weight basis, while ex-CIS low carbon wire rod offers given to Turkey stand at $770-775/mt CFR, both for September shipments. However, Turkish buyers are reluctant to conclude bookings at this price range considering the lead times and market uncertainties.
This week Turkish producers' mesh quality wire rod export offers stand at $735-745/mt FOB, softening by $5/mt as compared to last week. However, considering the global economic turmoil, buyers in international markets are currently adopting a wait-and-see stance.
In our previous reports, it was said that Latin America, as well as West and Central African markets are among Turkey's important wire rod export markets. The data for July exports support this opinion, as can be seen below. In the meantime, Italian buyers seem to have increased their wire rod imports from Turkey in the pre-holiday period to increase their inventory levels.
Country |
Volume (mt) |
Change (%) |
|
July 2010 |
July 2011 |
||
Brazil |
8,936 |
20,416 |
128.48 |
Kenya |
2,791 |
16,923 |
506.26 |
US |
19,481 |
12,555 |
-35.55 |
Israel |
4,770 |
8,730 |
83.02 |
Ivory Coast |
0 |
8,801 |
100.00 |
Senegal |
0 |
7,930 |
100.00 |
4,293 |
6,000 |
39.77 |
|
Benin |
0 |
5,700 |
100.00 |
Ghana |
0 |
4,874 |
100.00 |
Syria |
4,000 |
4,510 |
12.75 |
Albania |
112 |
3,087 |
2,648.64 |
Iraq |
999 |
3,034 |
203.85 |
Jordan |
0 |
3,000 |
100.00 |
Nigeria |
0 |
2,800 |
100.00 |
Congo |
27 |
2,314 |
8,438.75 |
Total |
112,659 |
118,714 |
5.38 |
Source: Istanbul Mineral and Metals Exporters' Association (IMMIB)