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MANUFACTURING TECHNOLOGY
What does 2010
have in the cards
for wire rod?
It is the primary material for most cylindrical fasteners so the vagaries of the wire
rod market have a signifi cant infl uence on the business of every fastener supplier.
We put Murat Askin, general manager at SteelOrbis Americas, on the spot and asked
for his assessment for 2010.
Chart based on SteelOrbis data.
I must admit my predictions regarding
Metric Tonnes
8,000,000.00
wire rod have been a bit sketchy lately.
US WIRE ROD CONSUMPTION
Looking back, I have been overly optimistic
7,000,000.00
at times and too pessimistic at other times.
Does that ring a bell? I am sounding a bit 6,000,000.00
like folks in the wire business, aren’t I?
In my previous life, I was a wire rod
5,000,000.00
trader, buying rods in the international
markets - Turkey, China, CIS, Germany, you
4,000,000.00
2,153,000 mt est.
name it – and selling to various wire drawers
in North America. One thing is for sure: we
3,000,000.00
rod and wire people gravitate toward the
2,000,000.00
extremes. When the markets are down and
prices are decreasing, we tend to think the
1,000,000.00
world is coming to an end. And when the
market is swinging high, we work ourselves
0.00
up into a state of ecstasy pretty quickly.
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Despite my bipolarity, I always aim
towards recovery but we are still in a very bad 500,000 units in just over two-and-a-half
to be optimistic and would like to project
place. The small improvements in the overall years. Housing starts have picked up a little
hope rather than doom and gloom. But ‘09
catastrophic conditions just aren’t providing steam recently, rising to about 570,000 units
hasn’t been my kind of year. I had hoped
any much-needed relief for the wire industry. late in 2009, but are still far away from more
the dismal conditions would pass but while
To quantify just how bad things really healthy levels of one million-plus units.
we were waiting for things to improve, they
are in the US, let us look at the consumption These are the main culprits of the American
actually got worse. In the end, there wasn’t
data for the year. While 2008 wasn’t a stellar wire industry’s current woes.
much room for optimism in 2009.
consumption year by any stretch of the
imagination, 2009 has become the worst
“Despite the
“The bright spots
year in recent memory. The annualized
latest positive
wire rod consumption for 2009 looks like
are markets like
it’s going to be only slightly more than two
economic
million metric tons. This is down by over
Brazil, Chile
30 percent from 2008 levels and down an
indicators, wire
and Peru in
astonishing 70 percent from1999 levels.
rod demand
What a disaster!
South America,
How is it possible that while the overall
in Europe,
economy shrank by only a few percentage
and certainly
points, wire consumption was taking such a
particularly in
China in Asia.”
bad beating? Well, this recession delivered
southern Europe,
hard blows to two of the American wire Looking at the international situation, big
industry’s biggest consumers: the housing markets like Europe and the Middle East are
is still very weak.”
and automotive industries. Year-to-date still struggling with weak steel demand in
North American vehicle production is down general. Despite the latest positive economic
Now, here we are, closing the curtain on
by close to 50 percent compared to last indicators, wire rod demand in Europe,
a year to forget, and things don’t feel any
year and the picture for housing is not much particularly in southern Europe, is still
better than they did at the beginning of it.
prettier. Annual housing starts plunged from very weak. Some Italian wire drawers are
Sure, economic indicators are now pointing
just over two million units down to less than extending their Christmas holiday period
Fastener + Fixing Magazine • Issue 61 January 2010
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