With weak demand seen in the Middle East countries due to Ramadan, offer prices to this region have shown decrease during this week.
Against the backround of the reduced trading activities due to Ramadan and the still continuing projects in Egypt, players are expected to begin their purchases after Ramadan and are likely to conclude bookings even though the prices they accept may be fairly high. Meanwhile, it is heard that South African flats producers are offering prices to Egypt, with the offers in question standing at the level of $930/mt CFR Egypt. However, in Egypt the acceptable price level is currently seen as $880/mt CFR Egypt, though no bookings have been heard at this level.
Looking at the Saudi Arabia market, HRC prices are currently standing at the level of $1,100/mt ex-works. While prices have seen an approximate $100/mt softening compared to the previous levels, demand is not very strong in this market, either. Offers from China to Saudi Arabia are at the range of $890-900/mt CFR Saudi Arabia. It is heard that there are also offers from South Africa to the country in question. Current offer prices from South Africa are standing at the level of $920/mt CFR Saudi Arabia.
During the current week, offer levels to the UAE again saw a drop compared to the previous weeks. Offers from Russia are standing at $920/mt CFR UAE, while offers from Ukraine are at $900/mt CFR Dubai. Meanwhile, offers from China have decreased to below $900/mt and are currently standing in the range of $880-890/mt CFR Dubai. At the same time, offers from India are also at higher levels. The most recent HRC offer from an Indian mill was at $960/mt CFR Dubai. Importers in the UAE are not expected to start making purchases until after the end of Ramadan.
As regards the Iranian market, this week, following the announcement issued by Mobarekeh, HRC prices decreased to the level of $790/mt. In the Iranian market, stockists are currently examining other markets in order to export material, given the high priced materials in their hands left from previous bookings. It is also heard that the most recent offer from Mobarekeh to the export markets was at the level of $1,000/mt FOB. Accordingly, general price levels from Iran have dropped and there are offers to the UAE at below the level of $920/mt. Furthermore, the mills in Iran are trying to re-export.
Although there are a lot offers heard in the Middle East, it cannot yet be predicted how far prices will decline, as buyers are currently holding back. With the conclusion of Ramadan we will gain a clearer idea of the state of demand. For the time being, the market is just standing back and observing the new price levels.