The downturn in the Italian wire rod market continues, with prices weakening by some €50/tonne ($51) week-on-week in a buyer-seller standoff, market participants tell Kallanish.
Some customers, such as drawing mills, are implementing production stoppages and temporary layoffs. They point to a serious demand slowdown and depressed consumer confidence. However, in 2022 all players throughout the value chain have posted record financial results, supported by strong demand in the first half of the year. Companies are well-stocked for the current low demand and will continue to purchase small tonnages until the end of the year when longer stoppages are envisaged for the Christmas holiday.
In Italy and some other European countries, wire rod producers have mothballed their plants since October, and some in northern Europe idled production for as long as three to four weeks.
Italian contract prices are now hovering at €690-710/t ex-works for drawing-quality wire rod. At present, imported material from the Middle East and North Africa is offered at $650-660/t cfr Italy, sources suggest.
Meanwhile, northern European wire rod prices also continued to fall last week, with sales low and only small volumes being purchased. Most sources expect this trend to continue until the end of the year. Domestic transaction prices for drawing-quality material are hovering at €740/t ex-works and mesh-grade wire rod is down to €750-760/t (see Kallanish 18 November newsletter).
Natalia Capra France