While the
rebar markets appear strong at the start of 2007, we have not yet seen the same strength in the
wire rod markets.
The Turkish mills' export offers for mesh quality
wire rods, which were at $460-465/mt FOB in late November, have increased by $20-25/mt to $480-490/mt FOB levels. A cargo composed of 10,000 mts of mesh quality
wire rods is heard to have been sold to Algeria at $512/mt CFR level. However, taking into account the fact that
rebar prices in the same period increased by more than $50/mt, the increase in
wire rod prices has not pleased the Turkish mills. Moreover, since
billet prices almost reached the levels of
wire rod prices, the Turkish mills seemed to be reluctant to conclude exports at this price level. The ones, who have proper
rebar production lines, preferred to produce
rebar instead of
wire rod. On the other hand, the mills without
rebar production lines, sold billets - originally allocated for
wire rod
production - to the local market or export markets without rolling. However, on the last day of the week, this situation has changed, and offers at $505/mt FOB levels for export to Southern
Europe have started to be heard on Friday.
When we look at the
CIS market, we see that the export market for Ukrainian rebars indicated declines in December. It still seems impossible to find competitive offers from
Russia. Mittal Steel Kriviy Rih
production mesh quality
wire rods are heard to have declined to a level of $440/mt FOB for exports to East and North
Africa in December. However, SteelOrbis has been informed that the producer has hiked its prices this week. For
Middle East and Gulf region, there are offers heard at $450-460/mt FOB for late February shipments. However with this increase, the mills in southern
Europe, where the local market is not strong, may benefit from the duties applied on non-EU countries, and may conclude sales to Algeria.
Since there are Chinese origin
wire rods available in large quantities at the ports and warehouses of southern
Europe, the
wire rod market in this region has experienced a very bad period since the third quarter of 2006. In the local Portuguese market, mesh quality
wire rod prices are at Euro 405-410/mt on delivered to customer basis. Although there is no price indication in the Italian market, it is forecasted that the prices may be at around Euro 420/mt ex-works level.
Export offers given by
Egypt are in parallel with the offers given by
Turkey. Offers for mesh quality
wire rods, which were at $460-465/mt FOB
Egypt in late November, seem to have increased to a range of $480-490/mt FOB
Egypt.
Wire rod prices in
Turkey and
Egypt, though slowly, have been increasing since December. Ukrainian origin
wire rod prices seem to have increased slightly this month. However, demand in the Mediterranean region is still slack. The fact that Chinese
wire rod prices have slightly increased, reaching a level of $420/mt FOB, and that demand has slightly revived in the Southeast and
Far East Asian markets may give momentum to the
wire rod market in the coming period.