Despite the import HRC safeguard effective in Egypt and set to remain in place until the end of the current quarter at least, HRC import purchases continue, though in lower volumes. Moreover, Russian HRC, mainly the sanctioned material, remains in demand since it is offered to the region at the most attractive prices.
Most Russian mills have started offering March shipment HRC for export and in particular in North Africa one of the sanctioned producers is indicating $485/mt CFR, including Egypt, up from $470-480/mt CFR closed in the previous sales round. In addition, according to the buyers from the MENA region, another sanctioned Russian mill has remained at $470-475/mt CFR in offers, but in this case some of the February shipment volumes are still available. Ex-China HRC prices in Egypt have been reported at $505-510/mt CFR, while the same levels have been reported for Indian HRC for the same shipment term.
As a result, while the 13.6 percent import safeguard tax for HRC or a minimum of EGP 3,673/mt ($77.88/mt according to the current rate) is still valid in Turkey for 200 days from the date of imposition on September 14 last year, most import HRC remains unworkable. “Imports remain of some interest in cases when either the price is low or/and if the supplies include breakdowns for which local deliveries are being delayed,” a source told SteelOrbis. As a result, the sanctioned ex-Russia HRC remains the most attractive option if any demand surfaces.
The domestic HRC prices in Egypt have remained at EGP 35,000/mt ex-works or around $650/mt ex-works according to $1 = EGP 47.16. The material is available for February deliveries and, according to sources, demand remains moderate. In the meantime, some market players have reported that the local mill has recently stopped its hot rolling in Suez, and so supply has been limited, and it is assumed that low demand is one of the reasons for the temporary suspension.
As for exports, the Egyptian mill remains absent, and no offers have been reported, although earlier it was expected to return to the market with March shipments at around $550-555/mt FOB. “This level is not quite workable in Turkey or in the Middle East and North Africa, while in Europe there is less chance [for Egypt] to sell against Turkey due to the latter’s lower AD and CBAM costs,” an international trader told SteelOrbis.
Local prices in EGP exclude 14 percent VAT.