Northern European wire rod market remains stagnated

Northern European wire rod prices have remained flat again this week due to low demand and higher energy costs in Europe.

“Summer holidays and traditional maintenance at plants also continue to lead to low demand from steelmakers,” a buyer from the Netherlands tells Kallanish. “I expect prices to go up in the next 2-3 months, but mills will probably reduce the used capacities amid high production costs.”

Domestic transaction prices for drawing-quality wire rod are at €870/tonne ($881/t) ex-works and mesh is at €850/t, sources say.

Producers are asking for €860/t ex-works, on average, for mesh-quality rod.

“Imports from countries outside the EU continue to influence the market and such offers are reported at around €790/t cfr,” another merchant notes. “Scrap prices are climbing again and not expected to drop soon.” This will also put pressure on the market, he adds.

Scrap values in Germany increased slightly so far in August. Old thick scrap sort 3 was at €350/t, while the price for new scrap sort 2/8 was at €360/t. In Austria, scrap prices are also up: old thick scrap sort 3 is at €350/t and new scrap sort 2/8 at €365/t (see Kallanish passim).

Most northern European wire rod market participants expect the market to be stable in the next few weeks. Some expect that the extremely low river water levels in Germany and other parts of Europe could impact raw materials deliveries this month and maybe spill into September.

Svetoslav Abrossimov Bulgaria