Wire rod buyers still seem reluctant in global markets

The global wire rod markets currently seem to be under the influence of the increasing Brent crude oil prices. Following the announcement made by the International Energy Agency (IEA) suggesting that, if crude oil prices continue to remain above $100/barrel, the export revenues of the Organization of the Petroleum Exporting Countries (OPEC) would reach $1 trillion, the markets have been focusing on the OPEC countries. And among these countries, Saudi Arabia, with its key role in regulating crude oil supply and with it high public spending budget, is now on top of the list of most promising export markets for wire rod.
 
However, most buyers in the Middle East and North Africa are still reluctant to conclude new wire rod bookings, due to the ongoing strong political tensions in the region. Witnessing reduced demand in their key export markets, some Turkish mills have headed to the southern Asian markets. However, the Turkish mills' drawing quality wire rod offers to the Indian market, given last week at $780-785/mt CFR for late April and May shipments, have been unable to attract the interest of Indian buyers.
 
On the other hand, assessing that the 2014 FIFA World Cup in Brazil may give rise to increased steel demand, Turkish mills are increasingly focusing on the South American markets. In the meantime, the Peruvian market has lately become one of the most promising markets in the region.
 
As regards the southern European market, in this week's Italian domestic market, local mesh quality wire rod prices stand at €530-540/mt ($754-768/mt) for deliveries to customer, while Algeria is now among the most important markets for Italian wire rod exports. In the meantime, SteelOrbis has learned from market sources that Italian wire rod buyers have continued to book on a weekly basis just to satisfy essential needs, in anticipation of a slight softening in scrap prices.
 
As the month of March draws to a close, it may be said that for now the prospects for the first week of April do not appear very positive.