Contrary to expectations, no positive mood has been observed in the Turkish wire rod market this week. Due to the similar price levels mentioned by mills for wire rod sales in the local market, the expectation of a price increase in the local post-holiday market has weakened. Slackening scrap prices in Turkey have also helped to diminish such expectations. Meanwhile, it is reported that the problems regarding a wire rod production line in Turkey's southern region have been resolved and that the line in question has resumed production.
After the conclusion of Ramadan no price change in wire rods has been observed in the local markets in the Middle East compared to the pre-Ramadan period. In particular, in Dubai, one of the leading wire rod markets in the Middle East, mesh quality wire rods are being offered at $510-520/mt delivered to customer excluding VAT. A significant factor as regards wire rods in the Middle East is the current low level of end-users' stocks due to their lack of purchases during Ramadan. On the other hand, firms that want to buy wire rods are now hesitating due to the response to their price inquiries.
Currently, buyers in the Middle East are behaving with greater caution as regards overseas offers they receive, as the impact of Chinese origin boron-added wire rod offers in the international markets is being felt strongly.
Meanwhile, ex-Turkey export offers to the Middle East for mesh quality wire rods have this week been at $520-530/mt C&F for November shipments; however, it is mentioned that the buyers are not showing great interest in these offers since ex-China offers for boron-added wire rods to the same region with the same terms are currently at $500-510/mt C&F. In addition, buyers are expecting more competitive offers in the near future from China since Chinese origin wire rod export offers have been slackening lately.
On the other hand, it is heard that ex-China wire rod offers to Southeast Asia for drawing quality ex-stock material are now at $530-540/mt C&F for prompt delivery. In the near past (when the influence of China's exports was slightly weaker), purchase activity in Southeast Asia was focused on the CIS due to the more acceptable price levels from that region. At present, buyers think that there may be a price increase in ex-CIS wire rod offers since the response from the CIS to price inquiries has been somewhat slow. In this context, wire rod buyers in Southeast Asia are turning their attention to alternative markets such as China.
Looking at the Turkish export wire rod market, we see that export offers are currently at $500-510/mt FOB for mesh quality wire rods. Turkish producers are turning towards the US market after the latest US domestic wire rod price increase and also since China is now stronger in the Far East market. Additionally, it is heard that this week there have been some low carbon wire rod deals with small tonnages from Turkey to the US for November shipments.
In Europe, buyers in Greece are currently hesitating due to the country's upcoming general election. Meanwhile, no significant change has been observed in the Italian domestic wire rod market compared to last week. However, it seems that Italian wire rod buyers are not eager to make new purchases due to the slackening of scrap prices in the region and the weak demand for wire rod in the local Italian market.