The Turkish wire rod market has been fairly quiet this week. The slight reduction of wire rod sales prices by some Turkish mills has led end-users to move with caution as regards new purchases. A few end-users in southern Turkey have continued to satisfy their wire rod needs from other regions in the country, since there is still supply difficulty in this region.
Meanwhile, it is mentioned in the market that a mill located in the Turkey's Marmara region is to recommence supplies of low carbon wire rod to the local market in the coming week. Consequently, it is expected that difficulties observed on the end-users' side regarding wire rod supplies from the Marmara region will diminish somewhat. However, currently it is not possible to talk about a strong recovery on the demand side in the overall wire rod market in Turkey.
The main problems observed on the end-users' side in Turkey are fluctuating wire rod sales prices as well as supply issues. In particular, end-users who opt to use various grades of wire rod at the same time in order to produce finished steel have been experiencing supply issues. This week the competitiveness of import offers, which have been having an increased influence on the local Turkish wire rod market, have made it more difficult for end-users to decide to purchase.
Far Eastern and Middle Eastern countries have continued to be the main export markets of the Turkish mills. However, export offers have decreased to the levels of $465-475/mt FOB - just as in last week's analysis we mentioned that exports offers could undergo revision. Also, in their wire rod exports to the Far East, the Turkish mills need to export large tonnages in order to obtain more advantageous freight rates.
In the Polish domestic market drawing quality wire rod prices are standing in the range of €330-340/mt, excluding VAT. It is also heard that ex-Eastern Europe mesh quality wire rod offers given to this country via traders are at €315-325/mt CFR for July shipment. Although the overall situation is positive in the Polish domestic market, demand has continued to be slack during the current week. In addition, some mills located in Eastern Europe have started to give offers to Poland for August shipment.
As for the Spanish market, it is reported that Spanish mills intend to raise their local prices. This week, in the Spanish domestic market drawing quality wire rod prices are at €350-360/mt delivered to customer. Meanwhile, demand in this market has continued to be sluggish.
Observing the price increases in the US market with great interest, most Turkish mills think further time is still required for both inquiry price levels and demand to increase before exports will be concluded to the US. On the other hand, China's lack of activity in wire rod exports for the time being favors the continued conclusion of sales by Turkish mills to the Far Eastern market.