Aiming to curb the spread of the Covid-19 virus in the country, the authorities in Dubai have announced a two-week lockdown from April 4, while the period may be extended depending on the developing situation. The restrictions imposed on business activities and movement across the city could have an impact on the steel sector, market insiders fear.
While a lot of businesses will be restricted in their actions, some vital sectors, such as food supply chains, pharmacies and medical institutions, are allowed to work in their regular mode. The construction sector is subject to obtaining a permit from Dubai Municipality and the Permanent Committee for Labour Affairs, according to the official statement.
While most of the steel production in the UAE is located outside of Dubai, the emirate is considered to be a center of steel consumption in the country. Since transportation has been significantly limited, market insiders are concerned there may be some disruptions of supplies. “We have our trucks not being let into Dubai. Only food and medicines are allowed,” a local wire rod producer has told SteelOrbis. Similar comments have been heard from flat steel traders in the UAE, who report there are some problems regarding deliveries.
According to sources, the situation, if not regulated somehow, may lead to some stoppages on the production side in addition to suspensions performed in the previous weeks and reported by SteelOrbis. “I think some solution will get worked out, but for now everyone is at a standstill, no trucks are allowed,” a source said.