The rising trend in the Turkish wire rod market has continued again this week. Strong scrap and steel billet prices are still supporting increases in wire rod prices. This week, the Turkish lira has reached up to 1.55 against the US dollar, causing domestic prices in Turkey on Turkish lira basis to increase.
Buyers in the Turkish domestic market, seeking to prepare orders amid the price increases, have continued to conclude bookings to meet their needs. However, companies with higher inventories are reluctant to conclude new transactions. Meanwhile, given the current demand situation in the local Turkish market, the slowdown in steel mesh, nail and wire sales has forced wire rod buyers to adopt a cautious approach to restocking activities.
Since most European steel market players have already gone on holiday, European buyers are now sending wire rod inquiries for imports with January shipments. The common expectation in Europe suggests that, following their inventory replenishments ahead of the New Year holiday, buyers may remain cautious as regards new purchases in January.
Most southern European mills are planning to continue their production with a reduced shift regime during the holiday. However, the holidays in the Italian steel market are expected to be longer as compared to other European markets. This week, in line with increased scrap prices, Spanish producers have increased their mesh quality wire rod offers to the price range of €505-510/mt ($661-667/mt) FOB for January shipments.
Meanwhile, buyers in the Central and North African markets are reported to be turning to neighboring countries for wire rod supplies, just like Middle Eastern buyers.
Due to the long Christmas/New Year holiday and economic problems in Europe, Turkish exporters' attention has switched from this region to alternative markets, such as the Middle East and Latin America. After recently concluding a number of successful bookings to the US, some Turkish producers are expected to increase their focus on this market.