In the past three weeks, local Italian drawing quality wire rod prices have increased from €520/mt to the current level of €550/mt ($644/mt) delivered to customer. According to market sources, even though scrap and billet prices have remained mostly stable in the same period, wire rod prices increased due to the expectations relating to the results of the EU Commission safeguard investigation on steel imports. At the same time, due to the uncertainty caused by this investigation, demand has not been particularly strong locally.
Meanwhile, the European Commission has announced its decision to impose provisional safeguard measures on 23 steel product categories, in the form of a 25 percent out-of-quota tariff. The provisional measures will be applied for 200 calendar days beginning on July 19. For this reason, sources believe that wire rod prices will increase in the EU and in Italy in the coming weeks. However, within the scope of these measures, the EU's import quotas will be 1,058,110 metric tons for wire rod, a limit that is considered "generous" for the next 200 days, as 1,055,000 mt of wire rod have been imported into EU in the first five months of 2018 according to EUROFER. According to the Italian steel producers association Federacciai, Italy in the same period has imported 160,000 mt of wire rod from non-EU countries, up 19.4 percent more year on year.