Middle East striving against steel shortage issue

Middle East striving against steel shortage issue

According to news from the industry, it is understood that European mills lowered the amount they were going to supply to Middle East by almost half as they preferred to shift their trade route to the US due to the revocation of S201 measures. Thus, it is highly expected that Middle East will face a severe steel shortage problem by early next month. Consequently, steel buyers in Middle East countries, which import low 1.2 million tons of steel every month in total from steel producers worldwide, are aggressively in the market in order to book every available material, particularly from steel mills in CIS. 60% of Middle East's requirements is imported from CIS. It is stated that the indifference of stockists in the region to the upward trend in steel prices, which started in late October and forced contractors in the UAE (United Arab Emirates) to renegotiate, was effective in this expected steel shortage problem. Besides, mills are reluctant to make bookings for large volumes with buyers and traders in the region that are even undertaking to pay almost 100% in advance. Therefore, the mills' attitude inevitably melts steel stocks rapidly. It is reported by a major stockist in the UAE that prices of certain steel products, such as hot rolled and long products, reached $415/ton level between November and December in 2003. Now, the price indication of Korean steel producers is at $475/ton for this month. In conclusion, prices of particularly structural steel products rose by 30-35%.