European Steel Wire Rod Prices Face Downward Pressure Amidst Sluggish Demand

In the week ending April 7, the Steel Wire Rod prices moved in a downward direction in the European market as the trading activity remained modest in the face of continuously low terminal demand. As per market players, domestic Steel Wire Rod makers' attempts to raise April rolling prices were unsuccessful. Producer price hikes implemented last month had the impact of halting the price decrease. However, trading activity remains skeptical and is expected to slow this week owing to the Easter and April 25 holidays. According to manufacturers, the European market for Steel Wire Rods is still sluggish; there is little visible demand, and real consumption is equally slow. Steel Wire Rod mills have secured enough orders for April rolling allocations, according to trading sources, but if end-user demand from the construction industry does not improve, the decline is likely to resume in the second half of April. As a result, the transaction was reported to be even lower, ranging between USD 730-745/MT Ex Ruhr.

In the Italian market, the Steel Wire Rod prices have remained steady on a weekly basis, with demand muted and several mills adopting production curtailment during the Easter weekend. According to a large local distributor of Long Steel products, they are not purchasing anything this month. Buyers assert that the current prices are still too high, and because clients are only buying limited, they believe they will place only a few orders of some flat products this month but no Steel Wire Rod or other long products. During the assessment week, Italy's main suppliers were still absent from the market. According to our sources, Steel Wire Rod makers may face sales challenges in the second half of the month if demand continues to remain unchanged. Furthermore, if scrap prices for May are much lower, market participants should expect Steel Wire Rod prices to fall. Given the high pricing of domestic Steel Wire Rods, several buyers are considering purchasing cheaper overseas materials. On the other hand, import alternatives for Steel Wire Rod customers remained limited.

As a ripple effect, ChemAnalyst anticipates that the European Steel Wire Rod prices will showcase stagnancy in their price trend as minimal volumes will be traded till further price clarification amid ongoing slow demand. With low demand, market participants were skeptical about whether the price increases were justified. The ongoing lack of demand will almost certainly create major resistance to any further uptrend. As a result, domestic Steel Wire Rod prices are expected to remain stable.